AUD50,000+ Reasons for Employees to Think Twice About Their Employer’s Copyright Works and Confidential Information

Employees often like to take a little with them when leaving employment, some might say as a ‘memento’, others might say as outright theft of the intellectual property of their employer.  In a recent decision, an ex employee was ordered to pay his former employer AUD50,000 in damages for copying over 60GB of data prior to leaving his job to work for a competitor.

In the decision of the Federal Court of Australia, Leica Geosystems Pty Ltd’s former employee Andrew Koudstaal (a software engineer) was found to have breached:

• copyright by reproducing copyright protected materials (including source code that he built into executable program files)
• the equitable duty of confidentiality that he owed by virtue of his access to his employer’s confidential information during the course of his employment, and which he breached by copying the volume of material taken in the days leading up to his resignation
• certain terms of his employment contract, including the obligation not to place himself in a position of a conflict of interest
• s183(1) of the Corporations Act 2001 by improperly using information obtained through his position with his employer for his own advantage or the advantage of another.

These findings were made despite the fact that the employee didn’t pass the materials onto his new employer and even though his prior employer didn’t suffer any detriment as a result of the conduct. 

Employers will no doubt welcome the decision, which sends a strong message to employees. While employees are entitled to take their general knowledge with them when they resign, taking copyright protected materials or confidential information is actionable, even if it was created by the employee during their employment, and even if there is no detriment suffered by the employer.