Use of confidential information crucial to damages claim

The High Court has found two ex-employees of a claimant (C) liable for breaching their duties of confidence, but has rejected C’s claim for substantial damages. Instead, C was awarded the nominal sum of £2.

C had sought damages of £15 million, based on breaches of duty in copying and retaining confidential files. Crucially, the case was not brought on the basis that the defendants’ misuse of confidential information had caused C to suffer any loss or resulted in the defendants making any financial gain.

In the case of one of the defendants, the copied files were never subsequently accessed or used. The other defendant had made limited use of a few files, but C had not sought a remedy for the use actually made.

This case provides a useful illustration of the court’s approach to damages in cases where liability and breach of duty can be swiftly established, but establishing a loss to the claimant or gain to the defendant is less clear-cut. The judgment highlights the importance of focusing a claim for damages on the realities of the situation, rather than hypothetical outcomes. It also demonstrates that, even in cases of clear wrongdoing, the court’s role is not to punish but to recognise loss suffered, or gains illegitimately made.

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