The Court of Session in Scotland has refused to grant an interdict (the Scottish equivalent of injunction) to prevent a public inquiry from publishing “commercially sensitive” information, which was alleged to carry with it a “very real risk of significant harm and damage”. The judgment underlines the level of detail required where companies seek to protect confidential and commercially sensitive information in this situation.
Earlier this month, the Court of Session heard an application from Bilfinger Construction UK Limited (“Bilfinger”), a core participant in the Edinburgh Tram Inquiry (the “Inquiry”), which sought to prevent documents being published on the Inquiry’s website. Bilfinger’s application for interdict was refused on the grounds that Bilfinger failed to show that the Chairman of the Inquiry had acted improperly in deciding to allow the disclosure of the information.
The Edinburgh Tram Inquiry was commissioned by Scottish Ministers in 2014 and aims to establish why the Edinburgh Trams project incurred delays and cost more than originally budgeted. Bilfinger had been appointed to undertake the civil engineering works and electrical works for the Edinburgh Trams Scheme in 2008. In the course of the Inquiry, Bilfinger was issued with a notice under section 21(2) of the Inquiries Act 2005 (the “Act”) requiring it to produce certain documents to the Inquiry.
Although Bilfinger obliged, it followed this with an application under section 19 of the Act, which permits restrictions to be imposed on the disclosure or publication of any evidence or documents given, produced or provided to an inquiry. The matter came before the Chairman for determination, as prescribed under the Act. It was decided that the documents would be published – unredacted – on the Inquiry’s website. Bilfinger subsequently applied to the Court for judicial review, seeking an order suspending that decision and prohibiting the Inquiry from publishing or disclosing the allegedly confidential information.
Confidentiality and commercial sensitivity
The documents in question comprised monthly reports drafted by Bilfinger during the tram project for the purpose of informing its Group Management, headquartered in Germany. The reports consisted of charts and tables, and included headings such as “Performance sheets”, “Cost reconciliation and forecast”, and “Commentary”. It was argued by Bilfinger that not only was the information contained in those reports commercially sensitive, but that the very format and structure of the reports was a proprietary tool developed by the Bilfinger Group, which itself constituted a trade secret. On that basis, Bilfinger contended there was a very real risk of significant harm and damage to the Bilfinger Group if the information was disclosed; it would weaken their commercial advantage.
The Chairman disagreed. He considered whether restrictions on the information were necessary in the public interest. He was tasked with a balancing exercise between, on the one hand, public interest in publication of documents provided to the Inquiry (such as might aid the understanding of the reasons for the conclusions that the Inquiry may ultimately reach) and, on the other hand, the public interest in avoiding risk of harm or damage caused by disclosure of commercially sensitive information. Ultimately, the Chairman was not convinced that the information was genuinely commercially sensitive, nor that it would risk harm or damage. He observed that there was a high level of generality on why the information was commercially sensitive and there was a lack of detail about the type of harm and damage that might occur.
The Court’s decision
The Court had to decide whether the Chairman’s decision was either: (1) irrational and unreasonable; (2) had no proper evidential basis; (3) failed to take into account relevant material; and/or (4) was procedurally unfair. Bilfinger also sought equivalent treatment, pointing to the fact that another core participant in the Inquiry had benefitted from a restriction order in respect of their commercially sensitive documents.
The Court found against Bilfinger on all grounds. The Court found itself “at just as much of a loss as [the Chairman] as to why either the substance or the methodology of the report has a continuing commercial sensitivity whose publication would cause damage to….the Bilfinger Group”. The assertions of potential harm and damage fared no better. For example, it was said that descriptions of ways in which competitors would have benefited were “without any explanation of how publication of either the information or the methodology could have that consequence. Such a lack of explanation [was] compounded by internal inconsistencies in the assertions”. The Court refused to strike down the Chairman’s decision and imposed no restrictions on the disclosure of the monthly reports.
Comment: the devil is in the detail
It is clear from this judgment, as well as the decision of the Chairman that preceded it, that any party seeking to contend that information is “commercially sensitive” must back this up with specific examples, linking that sensitivity to tangible instances of potential harm and damage upon disclosure.
The decision is also an important reminder of the high risk borne by applicants when seeking to prevent disclosure of commercially sensitive information. In bringing the application and in failing to succeed, the applicant has arguably brought more attention to the documents themselves, through publicly highlighting what aspects they deemed commercially sensitive, now reflected in the public judgment of the Court itself.
Ultimately, Bilfinger’s case fell on a failure to demonstrate how harm and damage might occur, what that harm and damage would look like, and precisely who would suffer it. It is clear that, in future applications concerning the protection of confidential and commercially sensitive information, the devil will very much be in its detail.