In recent webinars and workshops we have discussed the issues presented by the use of social networking sites, particularly LinkedIn, by employees who leave to join a competitor or set up on their own. Last week, written judgment was handed down in relation to an injunction application in the case of Whitmar Publications Limited v Gamage, Wright & Crawley which considered the use of LinkedIn Groups in the context of that intended competition. I have attached a link to the judgment because by the standards of these things it is a fun read – Mr Gamage and his colleagues have kindly provided an absolutely exemplary demonstration of how not to make covert preparations to compete with your current employer.
Gamage and his two compadres set up a rival publishing company, Earth Island, before leaving Whitmar. Merely forming the company would be one thing but Whitmar argued that the three employees had also been taking active steps to compete against Whitmar prior to the termination of their employment. They had taken business cards which belonged to Whitmar, as well as databases of its customers. Whitmar’s Linked-In groups appeared to have been used as the source of a round-robin email inviting a large number of individuals to attend an Earth Island event at a rather odd choice of venue for a covert launch, a bar in Leicester Square.
The Judge commented that: “Ms. Wright was responsible for dealing with the Linked-In groups as part of her employment duties at Whitmar. Those groups operated for Whitmar’s benefit and promoted its business, and Ms. Wright used Whitmar’s computers to carry out her work on the Linked-In groups”. He was clearly persuaded that the evidence pointed towards the LinkedIn Group being something in which the employer had a proprietary interest even though LinkedIn’s own terms say specifically that any information held in a LinkedIn account belongs to the account-holder.
The email addresses and business cards had provided the three Defendants with a competitive advantage and the Judge granted “springboard” relief until full trial. Even though none of the three Defendants had any contractual post-termination restrictions on dealing with Whitmar’s clients, the effect of the springboard injunction was that they were restrained from dealing with any of the contacts whose names appeared on the business cards.
From a social media perspective, the interesting point in relation to the Order Whitmar obtained was that it included an active obligation on them to facilitate “exclusive access, management and control” of LinkedIn Groups to Whitmar. The Judge also ordered the defendants not to access or do anything which inhibited or prevented Whitmar from accessing the LinkedIn Groups.
Whilst employers may be encouraged by this robust approach by the Court, it should be borne in mind that there was very strong evidence here both of the individuals’ misconduct and, tellingly, of their efforts to conceal it. The Judge noted that “one of the badges of competition in cases such as this is the secrecy with which those who are competing go about their business.” Mr Gamage, for example, agreed to return the business cards to Whitmar, but before doing so (Whitmar alleged), he surreptitiously used an App called “Card Munch” to convert photographs of business cards directly into LinkedIn contacts. Top marks for initiative, but sadly let down at the last fence when he also emailed a contact about identifying a name for a new title he planned to publish asking: “So how do we do that without blowing our cover?” Oops!