In DLA Piper’s case of the week, the High Court required a former employee to hand over the details of a LinkedIn account that she had established in the course of her employment, but that she had also used for personal purposes.
Whitmar Publications Ltd v Gamage and others
Mr Gamage, Ms Wright, and Mr Crawley were all long-term senior employees of Whitmar Publications Ltd, a publishing company specialising in magazines for the printing industry. The employees were engaged under the terms of a letter of engagement stating that they were subject to Whitmar’s terms of employment. The employees all resigned from their senior positions on 7 January 2013, stating that it was their intention to set up a competing company, Earth Island.
However, after the employees’ departure, it transpired that they had in fact established their company on 31 August 2012. It also came to light that, while they were still employed by Whitmar, they had allegedly:
- solicited or attempted to solicit a number of Whitmar’s clients and staff for their new enterprise;
- used Whitmar’s confidential information to create media packs and printing guides for Earth Island that were similar to those used by Whitmar;
- used LinkedIn groups managed on behalf of Whitmar to market their new company; and
- taken Whitmar’s circulation and customer databases with them when they left.
When challenged with regard to the use of the LinkedIn groups, Ms Wright claimed that the groups were her own personal hobby and not linked to Whitmar’s business. She therefore not only refused to reveal the username and password to Whitmar, but continued to use the account (and the contacts it contained) after her resignation.
Whitmar commenced proceedings against their former employees, claiming damages and also seeking an injunction restraining them from using and disclosing confidential information obtained during their employment.
The High Court upheld Whitmar’s application for an injunction, pending a full trial of the issues, finding that there was strong evidence that its former employees had been taking active steps to compete with Whitmar for over a year in advance of their resignations. The High Court ruled that the customer and circulation databases amounted to information that was confidential to Whitmar, and that the information removed by its employees was sufficient to provide Earth Island with a competitive advantage. The role that the LinkedIn group accounts played in the marketing of the new business was also the subject of discussion before the High Court, in particular its significance as a source of contacts for Whitmar. The end result was an order for Wright to deliver up details to enable Whitmar to access and amend the database.
This decision is thought to be the first time the ramifications of the misuse or misappropriation of a company LinkedIn account, together with all of the business contacts that it contains, have resulted in a court order to deliver up log-in details to an employer. It is significant that despite the fact that the LinkedIn account had been set up by an employee in her own name and contained contacts that were no doubt personal to her, the court concluded that it was the property of Whitmar and that the log-in details (and hence ownership of the account) should be passed to it.
There are lessons for all parties in this decision. Employees should take note that a LinkedIn account that is established in the course of their employment by a company and used to market and advance that company’s activities, may well be the property of the company, even if the employee has also been using the account as a personal contact database.
Employers, on the other hand, need to remain vigilant and aware of the continually evolving world of social media. Although it was not a stumbling block in this case, employee contracts should include a clear direction as to ownership of corporate or employee-created LinkedIn accounts or similar databases. Employers should also be aware of the potential damage that can be caused to their business in the event of the defection of an employee who may have been using such an account to build and maintain an online contact base.
Kate Hodgkiss is a partner at DLA Piper
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