Ensuring sensitive commercial information is adequately protected is essential to businesses, particularly in the information age. Practical measures and pre-emptive contractual provisions may not always be enough so there is always potential recourse through the law of confidential information.
The Basis of Confidence
English common law provides remedies for breaches of confidence in relation to personal information, commercial information and governmental information. A duty of confidence arises when confidential information comes to the knowledge of a person and it would be unfair for that person to disclose the information to others. It has particular effect when the person in receipt of the information is aware or has agreed that the information is confidential. Before initiating a civil claim in respect of breach of confidence there are a number of tests that must be met.
The most significant use of the law in economic terms is for its traditional purpose of protecting businesses from misuse of commercially sensitive information such as trade secrets by employees or former employees.
More recently, Article 8 of the European Convention of Human Rights, incorporated into English law by the Human Rights Act 1998, has given prominence to its use for protection of private information. This relates to individuals’ right to respect for private and family life.
Establishing a Breach of Confidence
There are three important requirements that must be met to show that a breach of confidence has occurred:
- The information communicated must have the necessary quality of confidence about it;
- The information was communicated or became known in circumstances that imported an obligation of confidence; and
- There was an unauthorised use or disclosure of that information.
Types of Confidential Information
There are four basic categories of confidential information:
- Commercial information or trade secrets;
- Personal or private information;
- Journalistic or artistic information; and
- Government secrets.
Defences
There are a number of circumstances that will bar a breach of confidence claim from being successful:
- If the information is already in the public domain;
- The information is trivial; or
- There is a public interest in the disclosure of the information.
Conclusion
Prevention is always better than cure, particularly in respect of confidential information in a business setting. Once trade secrets have been released to competitors the damage may already be done and a legal solution may not fully compensate for the loss of competitive edge.
If you need advice in relation to contractual confidence clauses or for a breach of confidence Rollingsons has experienced lawyers who can advise you; for more information please contact James Crighton via e-mail jcrighton@rollingsons.co.uk or by telephone on 0207 611 4848.
