Breach of confidence is a common law action which can be used in the event of threatened or actual disclosure of confidential information, whether such information is contained in documents or otherwise.
What the plaintiff needs to show
The leading case on breach of confidence is Coco v A N Clark  RPC 41. The elements of the cause of action are:
- The information must have the necessary quality of confidence about it;
- There must have been circumstances where the confidant ought reasonably to have known that the information had been imparted in confidence; and
- There must have been unauthorised use of the information, which use was (possibly) to the detriment of the confider.
The legal claim is relatively straightforward. A plaintiff must show that the defendant knew that it was not entitled to use the material.
There is debate about the extent to which detriment to the plaintiff must be proven, but as with most intellectual property rights the Court will readily infer damage as a result of the breach of a proprietary right without permission. This may be relevant to remedy, however.
Defendants tend to respond to a claim for breach of confidence on the basis that:
- The material was not confidential;
- Without prejudice to that, they did not use it; and
- Without prejudice to that, its use did not cause damage to the plaintiff.
Once material is public, the Court is unlikely to grant interim relief preventing the use of the material and the plaintiff’s focus will be on damages. Damages can be based on the profits made by the defendant or the losses suffered by the plaintiff.
Importance of strategy
It is important to establish an overall strategy at the outset, bearing in mind the different parties involved. This principally relates to decisions about which of the different court procedures best serve the client’s interests, particularly where there are multiple possible defendants.
Use of confidential material can often amount to a breach of contract, either a confidentiality clause within a wider agreement or a non-disclosure/confidentiality agreement entered into principally to protect the discloser’s position.
Where an employee or former employee appears to have breached duties of confidence, there are important strategic decisions to be made about the appropriate forum for pursuing those matters. The Employment Relations Authority has exclusive jurisdiction over alleged breaches of an employment agreement, but an action for breach of confidence at common law can be pursued in the High Court, even against a former employee.
The choice of court depends on an overall assessment of:
- the parties involved;
- whether there are allegations being pursued which do not relate to the employment relationship;
- the remedies sought; and
- whether the plaintiff wishes to apply for a search order.
Breach of confidence cases can appear deceptively simple, since the elements of the cause of action are straightforward. However, the procedural choices can make a significant difference to the overall length and cost of the dispute, and the extent to which it interferes with the complaining party’s business. For that reason it is important to obtain experienced specialist advice at an early stage.