In Fairstar Heavy Transport NV v Adkins and Another [2012] EWHC 2952 (TCC) the High Court of England and Wales held that there is no proprietary interest in the content of e-mails. The Court deemed the laws relating to copyright and misuse of confidential information sufficient to protect such content and, therefore, the establishment of any other interest was not necessary.

BACKGROUND

Fairstar Heavy Transport NV (Fairstar), was a Dutch company specialising in the transportation of heavy and valuable large machinery. Philip Adkins was the former CEO of Fairstar. He was employed through the second Defendant, Claranet Ltd. As Mr Adkins was not employed directly by Fairstar, copies of emails for his attention were forwarded automatically to his email address hosted by Claranet’s server. Fairstar contended that these e-mails were deleted automatically from Fairstar’s server and that, once forwarded, Fairstar no longer had access to them.

Mr Adkins’ employment contract with Fairstar was terminated following a hostile bid and takeover by a rival shipping company. Fairstar was involved subesquently in a dispute with a Chinese shipyard supplier and subject to an investigation by the Norwegian stock exchange authorities. The e-mails forwarded to Mr Adkins during the course of his employment were required for use as evidence in the dispute and the investigation.

Mr Adkins contested Fairstar’s right to see the e-mails and since, under the terms of Mr Adkins’ employment contract, all disputes were subject to the jurisdiction of the Dutch courts, Fairstar was required to prove ownership of the content of the e-mails in order to gain access to them.

Fairstar submitted that it had a proprietary right to the content of the e-mails held by Mr Adkins. Crucially, however, it did not seek to rely on any other claim for copyright in the content of the e-mails, or any duty of confidentiality owed by Mr Adkins to Fairstar under the terms of his employment.

The Honourable Mr Justice Edwards-Stuart held in favour of Mr Adkins as he did not find any practical basis for establishing a proprietary right in the content of the e-mails.

DECISION

Fairstar cited various authorities and relied primarily on the decision of the Court of Appeal in Lamb v Evans [1893] 1 Ch 280. Ultimately, Fairstar submitted that whilst there was no settled law relating precisely to e-mail content, “logic and the circumstances of the modern world should encourage the Court to hold that e-mail was a form of property” and that it would be unrealistic for the Court not to recognise that an employer or principal had a proprietary right in the electronic materials created by, or coming into the possession of, an employee or agent during the course of employment or duty.

Edwards-Stuart J considered that most of the case law submitted by Fairstar in fact strongly contested the possibility of proprietary rights in the content of information. In order to test his theory, he considered five hypotheses:

  1. The content of the e-mail remains always with the creator.
  2. Title to the content of the e-mail passes when sent.
  3. As for 1, but the recipient has an implicit licence to use the content.
  4. As for 2, but the sender has an implicit licence to use the content.
  5. Proprietary rights to the content are shared between the sender, the recipient and any other party the content is forwarded to.

Edwards-Stuart J disregarded the first and second hypotheses for lack of practical application. He considered that it would be illogical for a creator of an e-mail to be able to enforce his or her rights in its content upon any or all persons further down an e-mail chain and, if such rights were to be limited to a specific number of onward recipients, such a limitation would effectively invalidate the right altogether. Further, Edwards- Stuart J considered the second hypothesis to be impractical, as it would be too confusing to determine to whom title to the content of the e-mail had passed where it was sent to multiple recipients.

In principal, Edwards-Stuart J considered hypotheses 3 and 4 to be “workable”, although they would result in the proprietary interest in the content of the e-mail having little or no resultant value. Any licence would depend on the extent to which the content was used legitimately. This could be determined using the test for misuse of confidential information and, accordingly, there was no need to establish a proprietary right as the law already provided adequate protection in this respect.

Finally, Edwards-Stuart J dismissed the final hypothesis, which was the closest to Fairstar’s submission, as unrealistic and impractical.

COMMENT

Whilst this case offers useful assistance in establishing the current situation with regard to any rights or interests in e-mail content, it has not resulted in any settled law that advances the current position. The Court considered that any rights to the content of the Claimant’s e-mails were protected adequately already by other causes of action that can be relied upon more easily, such as copyright, misuse of confidential information, breach of data protection and/or breach of contract.

As there is latent uncertainty with regard to the current position, this may result in other cases before the courts, or in revisions to or increases in detailed drafting in employment or other contracts of engagement to ensure that the position regarding e-mail property is set out clearly.