A Commercial Secret Dispute Case Involving Purchase Intention of One Single Potential Customer
Plaintiff Magnettike Control System (Shanghai) Co., Ltd. filed a lawsuit against Defendant Li Jianbin et al for infringement of trade secrets and other unfair competition [Civil Judgment (2016) H0110MC No. 6392 of Shanghai Yangpu District People's Court, members of the collegial panel: Zhang Qian, Liu Yanping, Wu Kuili. Civil Judgment (2017) H73MZ No.250 of Shanghai IP Court, members of the collegial panel: Li Shulan, He Yuan, Fan Jingbo]
[Case Brief]
The Plaintiff authorized the outsider Shenzhen Dashi Intelligent Co., Ltd. (hereinafter referred to as Dashi Company) to participate in the bidding for the Shenzhen Metro Project. Defendants Li Jianbin, Zhang Jiarong, and Shi Huiling were the employees of the Plaintiff, whose confidentiality obligations were stipulated in their employment contracts. Defendant Li Jianbin used the convenience of being the sales manager of the Plaintiff to tell Dashi Company that the Defendant Emère (Hong Kong) Automation Control Technology and Services Co., Ltd. (hereinafter referred to as MA Hong Kong) was the affiliate of the Plaintiff, and Dashi Company signed the contract with MA Hong Kong as a result. It was found that Defendant Zhu Jiawen, former wife of Li Jianbin, was the sole shareholder of MA Hong Kong Company. The Defendants Li Jianbin, Zhang Jiarong and Shi Huiling resigned from the Plaintiff and went to the Defendant, Maotuo Automation Control Systems (Shanghai) Co., Ltd. (hereinafter referred to as the Maotuo Company), which assisted MA Hong Kong Company in performing the contract. The shareholder and legal representative of the Defendant Maotuo Company was Defendant Pan Shirong, the Defendant Li Jianbin's father. The Plaintiff filed a lawsuit to the court, claiming that: Li Jianbin, Zhang Jiarong, and Shi Huiling illegally disclosed the Plaintiff’s trade secrets to Zhu Jiawen and MA Hong Kong and allowed them to use it. Maotuo Company and Pan Shirong provided cooperation and assistance. The actions of the seven Defendants had seriously infringed the Plaintiff’s trade secrets, which violated the principles of good faith and business ethics, and had constituted unfair competition. It requested the court to order them to stop the infringement and jointly compensate the Plaintiff for economic losses of RMB 1,840,453.34 yuan and reasonable expenses of RMB 2,041.92 yuan.
[Adjudication]
The court of first instance held that the actual information held by the Plaintiff, that is, the fact of Dashi Company’s purchase of the pedestrian access door module products produced by Magnetek Germany in the Shenzhen Metro Project, meets the provisions of Article 10, paragraph 3 of the Anti-Unfair Competition Law, and shall belong to the Plaintiff’s trade secrets. Li Jianbin and Zhang Jiarong learned the Plaintiff’s business secrets during the period when they worked for the Plaintiff. The products provided by MA Hong Kong Company were essentially the same as the content of the Plaintiff’s business secrets involved in this case and no legal source can be provided. Maotuo Company used the trade secrets involved in this case to assist in the performance of the contract while it knew that such trade secrets were owned by the Plaintiff. The actions of the Defendants Li Jianbin, Zhang Jiarong, MA Hong Kong Company, and Maotuo Company jointly infringed the Plaintiff's trade secrets. Therefore, it was ruled that the Defendants Li Jianbin, Zhang Jiarong, MA Hong Kong Company and Maotuo Company jointly compensated the Plaintiff for economic losses of RMB 1,400,000 yuan and reasonable expenses of RMB 1,641.92 yuan and issued a statement to eliminate the impact; the Defendants Zhu Jiawen and Pan Shirong respectively shall bear joint and several liability for the payment obligation of the Defendant MA Hong Kong Company and Maotuo Company. After the judgment of the first instance was issued, both parties refused to accept the judgment and filed appeals. The court of second instance dismissed the appeal sand upheld the original judgment.
[Typical Significance]
This case is a dispute involving violation of trade secrets and other unfair competition caused by employees' disclosure of the purchase intentions of potential customers of the company to their relatives. This case explores whether the purchase intention of a single potential customer constitutes a trade secret. The court believes that the purchase intention of a single potential customer obtained through certain efforts and efforts can bring certain value or competitive advantage to the right holder; if it conforms to the characteristics of secret, value and confidentiality of trade secrets, the protection of same as trade secret can promote fair and orderly competition.
photo from: alibaba.com
