Downloading information from your old employer could be a costly activity!

Oct. 2014

On 23 October 2014 the Federal Court of Australia handed down a decision that dealt with the downloading of software by an employee immediately before his departure from that firm and his taking up employment with a competitor.  This was a breach of confidentiality, a breach of the copyright legislation and, if the employee was a HSR, could have been a breach of the WHS 2011 legislation 

The Federal Court has awarded $50,000 in damages to a mining company after the former employee was found to have breached his employment contract as well as copyright legislation for downloading thousands of computer files as a “trophy” for his time at the company. 

Mr AK, a former software engineer with Leica Geosystems, downloaded and copied more than 60 gigabytes of data onto his hard drive shortly before resigning in November 2011. 

Leica Geosystems Mining is a company in the business of selling software products and providing services for the mining industry.  In particular they provide GPS controlled mine equipment control systems. The employee concluded employment with Leica in November 2011 and commenced employment with a competitor company 4 days later.  From 11 October until 3 November the employee deliberately copied large volumes of Leica’s material onto an external hard drive that he removed from the premises when he finally left their employment. 

Despite the court’s finding that the employee received no material benefit from use of the information, and his new employer had no access to the information, significant monetary compensation was payable by the employee. The facts were:- 

The ex employee was socialising with a friend from Leica when she saw a folder named “Leica” and its contents on a screen the employee was scrolling through when visiting at his home. The friend, who was still employed with Leica, advised her employer.

As a result Leica took action against its former employee.

The employee maintained that the materials had not been used in respect of the work with his new employer but the court concluded that the mere fact that it wasn’t used or benefited from did in no way answer Leica’s claim that in copying the material without their licence, consent or authority and later reproducing it on its own computer, he infringed Leica’s copyright in that material.

Leica had sought compensation of $40,000 for breach of confidence and $250,000 for breach of copyright together with interest and costs. The former employee was ordered to pay $50,000 plus Leica’s costs in relation to the proceedings.

It should be noted that although the employee did not receive any apparent benefit from the removal of the information, the courts still looked very unfavourably on the employees conduct.