Pakage Apparel Inc. v. Ellis 2014 BCSC 884 (CanLII)

In this case, the court implied that even though the defendants (who had been principals in the company) had obtained access to emails through the administrator’s password to the company’s email account, the emails had not lost their confidential nature.

Drafters may wish to ensure that the definition of ‘confidential information’ includes information stored or communicated in every medium, and that a clear protocol for the return of confidential information is included in the agreement.

Details of the case:

The plaintiffs applied for an order requiring the defendants to return electronic and paper copies of emails taken from the plaintiffs’ email accounts. The plaintiffs allege that the emails contained confidential and privileged information relevant to ongoing litigation between the parties. The plaintiffs also alleged that the defendants made some of this confidential information available to a competitor in violation of their obligations. The underlying business produced a line of men’s underwear (“MyPakage”). To complicate matters, No Limits, a competitor in the business, alleged that the plaintiffs and defendants in this action used the confidential information of No Limits and/or Saxx in starting the MyPakage business. At issue was whether the information in the emails was confidential, and whether the emails themselves were ‘property’ which could be the subject of an interim order for recovery of property. The court held that electronic correspondence, like paper mail, can be subject to a proprietary interest. The court also held that irreparable harm can flow from continued retention of privileged and confidential information, and ordered its return. The defendants were ordered to delete all copies of the emails from their own electronic devices.

To read the full case on CanLII, click here.


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