One year on from the Illiquidx Ltd v Altana Wealth Ltd judgment (following the collapse of a joint venture between the parties), we remind ourselves of the implications in respect of confidentiality and copyright issues.
The Claimant, Illiquidx, entered into a joint venture agreement and a non-disclosure agreement (NDA) with the Altana and Brevent (the Defendants) in connection with the creation of a fund for the purpose of a joint venture investing in distressed Venezuelan debt.
Before the funding was launched, the parties decided to exit the JV. Following this, the Defendants proceeded to set up their own separate fund in relation to the same opportunity. Illiquidx alleged that the Defendants misused their confidential information in doing so.
The confidential information in question related the process for creation of a fund that would be compliant with the US Venezuela-related sanctions in force as well as other specific information which had previously been provided to the Defendants.
A key factor for the Court to consider in this case was that whilst the information could be obtained from places that were in the public domain (including the Claimant’s website) it was likely the case that most of those who reviewed the content, would not have known it could assist in forming the basis of a sanctions-complaint fund for the purposes of investment in distressed debt. In other words, whilst the information was available publicly, it would be unlikely that many of those viewing it would know how to exploit its application.
The parties had entered into an NDA, which set out what information would be protected. As is typical in most NDA’s, information in the public domain was excluded from the scope of protection. The Defendants sought to rely on this exception.
It was accepted that the information could be obtained by public sources. The distressed debt was well known in the market however, the fact it could be traded without breaching sanctions, was only known among a number of specialist investors. As such, the business opportunity itself was not well known in the market and was, therefore, confidential information. As per Lord Goff in previous case law, information is in the public domain if it “is so generally accessible, that in all the circumstances, it cannot be regarded as confidential”.
The Defendants further argued that as the Claimant shared detailed materials that were not in the public domain in presentations to potential investors (as part of their marketing of the opportunity), the information had been brought into the public domain.
Mr Justice Rajah held that marketing of this kind, did not result in the information being classed as generally accessible, as it remained, fundamentally, removed from any competitors. The claims against the Defendants, for breach of the NDA and misuse of confidential information, were therefore successful.
In addition to the breach of confidentiality claim, the Claimant argued that following the collapse of the JV, the Defendants had infringed its copyright by replicating the Claimant’s presentation slides in their other business ventures. It was held that while the slides used by the Defendants contained such material, the reproduced parts did not amount to a substantial part of the Claimant’s slides as a whole and therefore the claim for copyright infringement failed.
