The North West High Court recently decided in favor of the protection of a company’s confidential information and trade secrets involving two former senior employees. DISPRO TECH SA (PTY) LTD (the applicant), a specialist gas emission testing company in the mining sector (one of its kind in South Africa), approached the court after discovering that two of its former senior employees established a competing business shortly after leaving employment.
For more context, the second and third respondents resigned from the applicant company on 2 June 2025 and left the company on 27 June 2025. SOOT SCIENCE (PTY) LTD (the first respondent) was incorporated on 8 July 2025 (eleven days after leaving employment). Soon thereafter, the second and third respondents began engaging with the applicant’s clients and presented proposals which closely mirrored the applicant’s methodologies and software.
The court was called on to determine whether the respondents had unlawfully used the applicant’s confidential information to advance their competing enterprise. The court applied the well-established “springboard doctrine” and confirmed that one party may not exploit another party’s proprietary efforts as a launchpad even where the information is not strictly confidential. The court also addressed the fiduciary obligations of the second and third respondents as senior employees. Given their positions and access to sensitive information, the second and third respondents had continued fiduciary obligations owed to the applicant, including an obligation not to exploit trade secrets for their benefit after the termination of their employment.
What is interesting is that evidence before the court showed that, prior to his resignation, the third respondent emailed the applicant’s custom-developed software to his own email account. This, coupled with the timeline of events, led the court to draw an adverse reference as it was extremely improbable that the respondents had developed the software used independently. The first and second respondents also expressed in a letter that they did not take fiduciary duties seriously. Furthermore, the first respondent did not deny in the letter that they are ‘springboarding’ the business of the applicant by using its confidential information and software.
Accordingly, the court interdicted the respondents from using or disclosing the applicant’s confidential information, were ordered to return and destroy such material, and were interdicted from unlawfully competing with the applicant for a period of 18 months. A punitive cost order on the attorney-and-client scale was awarded severally against all the respondents.
The protection of confidential information remains a core component of a company’s intellectual property strategy. Beyond the traditional intellectual property rights, trade marks, copyright, and patents, companies must take serious steps to safeguard their confidential information through well-crafted contractual and implemented internal governance measures.
