AUSTRALIA Trends and Developments Contributed by: John Lee, Siabon Seet, Vanessa Farago-Diener and Irini Lantis, Gilbert + Tobin
• Supplier information was not well-guarded – while New Aim used “white labelling”, access to its inter - nal purchasing system was extremely broad. • Industry practice did not support confidential - ity – suppliers at trade fairs openly disclosed their customers’ identities, suppliers were not typically bound by NDAs, and competitors could often iden - tify suppliers through online searches or “reverse sourcing” software. Information management is critical The outcome in New Aim is a reminder that simply calling something “confidential” does not make it so. To establish legal protection over supplier or custom - er information – or indeed, any trade secret or other information – businesses need to be able to demon - strate that the information is secret and valuable to it and has been treated accordingly, including by having in place appropriate measures to control access, use and disclosure. Courts continue to focus on whether parties asserting confidentiality: • limited access to the information; • clearly communicated to all that the information was confidential; • used appropriate labels, controls and security measures; • tracked exports/downloads; • restricted customer relationship management or other database extracts; and • had in place, and enforced, employee offboard - ing procedures, including requiring the return of all confidential information in hard copy and digital form. It is also critically important to put in place employ - ment and supplier contracts containing robust confi -
it enables a party to obtain discovery and confirm whether they have a valid claim prior to commencing a proceeding and committing the costs and resources involved. In the Federal Court of Australia, a prospective appli - cant may apply for preliminary discovery if: • it reasonably believes that it may have the right to obtain relief from a prospective respondent; • after making reasonable inquiries, it does not have sufficient information to decide whether to start a proceeding to obtain that relief; and • it reasonably believes that the prospective respondent has/had or is likely to have/have had documents in its control that are directly relevant to the question regarding whether the prospec - tive applicant has a right to obtain the relief, and inspection of the documents would assist in mak - ing the decision. If the court is satisfied as to these matters, it may order the prospective respondent to give discovery to the prospective applicant of the relevant documents, allowing the latter to identify with precision the infor - mation that has been misappropriated by the former (if any). A significant decision on preliminary discovery handed down in the context of a patent dispute was Pfizer Ireland Pharmaceuticals v Samsung Bioepis AU Pty Ltd (2017), FCAFC 193, in which the Full Court of the Federal Court of Australia overturned the decision of the primary judge to refuse preliminary discovery sought by Pfizer. The Full Court’s decision demonstrated that the threshold for obtaining preliminary discovery was lower than that imposed by the primary judge. In par - ticular, without suggesting earlier authorities had been incorrectly decided, Allsop CJ sought in his reasons “… to highlight the way the existing authorities appear to have been influencing these applications into a form of mini-trial where a form of fact finding takes place, well beyond the mandate of the words of the rule.” His Honour emphasised that applications for preliminary discovery “are summary applications not mini-trials”, and that “[t]he foundation of the application… is that
dentiality clauses. Available remedies Preliminary discovery
The inherent difficulty for applicants in identifying confidential information alleged to have been mis - appropriated has a solution that is (almost) uniquely Australian – seeking preliminary discovery from a pro - spective respondent. This is a very valuable tool for a party contemplating litigation in relation to breach of trade secret or confidential information as, critically,
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