Coco - Summary Introduction to Case Law PDF

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10. Coco v A N Clark (Engineers) Ltd [1969] An industrial information case. Case Name: Coco v A N Clark (Engineers) Ltd [1969] Court: Citation Judge:

High Court of Justice - Chancery Division (England) (Ch D) [1969] (2) RPC 41 Justice Megarry

Plaintiff:

Coco Mr Mowbray Defendant: A N Clark (Engineers) Ltd

Issue Statement The issue in this case is whether Coco will be successful in obtaining an interlocutory injunction on the sale of mopeds for breach of confidence against A N Clark Engineers Ltd when Coco had shared his designs and supplier lists on the basis the Clark Engineers would manufacture his moped and after months of communication Clark Engineers dropped the moped because of a fault in design and instead produced its own design and there are many similarities in the two designs The issue in this case is whether A N Clark Engineers will be liable to Coco in Breach of Confidence when [material facts] Whether confidence was breached? Whether Coco can prove that is he is likely to succeed at trial? The injunction is necessary to prevent damage in the meantime Balance of convenience - potential loss sufferred by plaintiff and likelihood of defendant to be able to pay damages or the plaintiff to compensate the defendant if they lost the case

Facts • Coco designed a moped and approached the defendant company with a proposal to manufacture the designed moped. A contract was drafted but never signed or terms agreed upon. Over the course of months, Coco shared his designs, list of suppliers etc with the defendant company. The company in the end told Coco that the design was not good because it would wear out the rear tyres very quickly and gave him no opportunity to correct the design or arrange for suppliers with suitable tyres. Instead the company started working on their own moped. They assured Coco that the new moped had nothing to do with the old one but Coco is sure that parts of design has been used in the new moped

Ratio

A manufacturer will not be in BOC if he uses information provided to him in confidence but the information is available in the public domain. Cause of action

Material facts Outcome - Related to the material facts in a way that describes the judge's decision.

Material Facts: • Coco shared his designs and supplier lists with Clark Engineers on the basis of the Clark Engineers manufacturing his moped • after months of communication Clark Engineers dropped the moped because of a fault in design. • Clark Engineers produced its own design instead • There are many similarities in the two designs. Procedural History (How has the case got to this point?): The plaintiff is seeking an interlocutory injunction on the sale of mopeds by the defendant company

Legal Issue

Specific Issue Judge's statement of the issues: Whether there has been any breach of the obligation of confidence?

Counsel' Judge's Reasoning s Argume nt 1. The information must have the necessary quality of confidence about it.

• Something that is public knowledge cannot be confidential. • Something constructed by materials in public domain may still have the quality of confidence. If something new and confidential is brought about by skill and ingenuity. • Difficulty arises when something is part public and part private. • No confidence in tittle tattle gossip (obiter)

2. That information must have been imparted in circumstances importing an obligation of confidence

• If a reasonable person (test) would realise on reasonable grounds that the information being communicated to him in confidence. • Not information that is blurted out in public • Will not protect trivial tittle tattle -> must have gravity. • Express agreement of confidential -> automatic satisfaction of limb. • Where commercial/industrial information -> high burden on defendant.

Result in this case: The injunction was not granted. Orbiter Dictum: Response to preparation questions for class:

Test: 1. The information must have the necessary quality of confidence about it. 2. That information must have been imparted in circumstances importing an obligation of confidence 3. There must be an unauthorised use of that information to the detriment of the party communicating it.

Ratio Establis hed

The circumstances under which the information was given were plainly circumstances which imported an obligation of confidence. Implied obligation to preserve any trade secrets.

3. There must be an Detriment to the • Unauthorised use unauthorised use of • Detriment to person plaintiff plainly exists. that information to required? the detriment of the Can be to someone the • party communicating person cares about it. - Obiter (obiter) Whether the case is one where an injunction ought to be granted?

The evidence falls short of the requisite for an interlocutory relief

Precedent

Prince Albert v Strange [1849]

Hierarc Material hy Facts

Decision

Reasserted the doctrine equitable jurisdiction in breach of confidence.

Counsel's Argument Basis

Judge Agrees Applied / Judge's Reasoning or Disagree Distinguished/App with Case roved / Extended /Overruled In the absence of a contract, altenative actions are equity and tort (privacy). Obligation arises from confidence. - passing on of information that you consider confidential.

Duchess of Agryll v Duke of Agryll [1967] Saltman Engineering Co. Ltd v Campbell Engineering Co Ltd [1948]

Ungoed - Thomas J Marital relationshi Publication of marital communications should be p. restrained as being confidential. Lord Greene M R The obligation of confidence may exist where there is no contractual relationship between the parties. • The information must have the necessary quality of confidence about it. • Something which is public property and public knowledge cannot provide any foundation for BOC proceedings. • However confidential the circumstances of communication - there cannot be BOC in revealing to others something that is already common knowledge

Terrapin Ltd v Builder's Supply Co. (Hayes) Ltd [1967] Seager v Copydex Ltd [1967]

Lord Denning M R When the information is partly public and partly private, the recipient must somehow segregate the two and is free to use the public information but must not take advantage of the private information. The recipient must not use the communication as a spring board.

Cranleigh Precision Engineering Ltd v Bryant [1965]

The mere simplicity of an idea does not prevent it being confidential....