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OCS Group UK Limited v Dadi, Omni Serv Limited and Ahitan [2017] EWHC 1727 (Ch)

The High Court sentenced a former employee, who was in contempt of court for his breach of an interim injunction, to imprisonment for six weeks.

In this case, OCS applied to commit the first defendant, Mr Dadi, to prison for contempt of court for his breaches of an order for injunctive relief, imposed on him after his employment was transferred to the fourth defendant, Omni Serv.

The facts

OCS is a company that provides services to the aviation industry. In March 2017, it lost a lucrative contract to its competitor, Omni Serv, for the provision of aircraft cleaning services to British Airways at Heathrow. The second defendant, Mr Dadi, was employed by OCS until it lost the British Airways contract, at which time his employment was transferred to Omni Serv pursuant to the TUPE Regulations.

OCS alleged that the fifth defendant, Mr Ahitan, and Mr Dadi conspired to send documents relating to its business to his personal email account. Like Mr Dadi, Mr Ahitan was also a former OCS employee who now worked for Omni Serv. OCS issued proceedings against the defendants seeking declaratory relief, an injunction and damages for their various breaches of contract, fiduciary duty and confidence.

OCS obtained an Order from Mr Justice Smith granting an interim injunction against Mr Dadi. The Order prohibited Mr Dadi from disclosing confidential information to third parties, required him to provide information about the disclosures he had already made, and imposed obligations on him not to destroy evidence and not to disclose to anyone else the existence of the Order itself. Mr Dadi was personally served with the Order, which contained the usual penal notice.

In breach of the Order, Mr Dadi proceeded to: (1) tell Mr Ahitan about the Order; (2) delete emails from his mobile phone, on the same day he was served with the Order; (3) carry out a mass deletion of emails from his personal email account the following day; and (4) inform members of his family and friends about the Order. Mr Dadi sought legal advice three days after he received the Order, following which, at the return date for the injunction, he admitted his breaches to OCS and the Court.

The law

Under the Contempt of Court Act 1981, section 14(1), the court may impose an immediate custodial sentence of up to two years’ imprisonment. Any person committed to prison in contempt of court is, however, entitled to unconditional release after serving half of his or her sentence: Criminal Justice Act 2003, section 258. The court may, alternatively, impose an unlimited fine or order sequestration of the respondent’s assets.

In the High Court, Mrs Justice Rose summarised the relevant principles for considering an application for committal in contempt of court, by way of reference to existing case law in this field [25] – [27]. The object of the committal as a sanction for contempt of court is both to “punish conduct in defiance of the court order and also to hold out the threat of future punishment as a means of securing protection which the injunction is primarily there to confer” [25].

Relevant factors the court should consider include: any prejudice to the claimant (and whether it is irreparable); any pressure placed on the person said to be in contempt; whether any breach was intentional; the respondent’s culpability; whether the breach arose from the conduct of others; the seriousness of a deliberate breach; and the cooperation of the contemnor (see further: Crystal Mews Ltd v Metterick and others [2006] EWHC 3087 (Ch)). Mrs Justice Rose also approved a number of additional factors (per Mr Justice Lewison, as he was then, in Aspect Capital Ltd v Hugh Christensen [2010] EWHC 744 (Ch)), including: the relevance of any (early) admission; any apology and frank cooperation with the court; and the respondent’s character and antecedents.

The judgment

As a “mark of the court’s strong disapproval of his conduct” and as a deterrence to others, Mr Dadi was sentenced to six weeks’ imprisonment. Mrs Justice Rose noted that (contrary to his assertions), his conduct was not attributable solely to his immediate panic on receiving the Order, as evidenced by the fact that he deleted the majority of the emails the following day. Other factors against Mr Dadi included the fact that he had specifically told Mr Ahitan of the existence of the Order (in circumstances where the prohibition on tipping off therein was clearly directed at him) and that OCS was likely to face irreparable prejudice since the emails could not be recovered.

Despite his clear culpability for the breaches, however, Mr Dadi was given credit for his early admission and apology, his frank and honest evidence in subsequent proceedings, and his attempts to help OCS retrieve the deleted emails. The court also recognised the likely impact that his imprisonment would have on his family and that he was of previous good character.

Comment

Despite the fact that injunctive relief remains the principal remedy in employee competition cases, it is uncommon for the courts to consider the sanctions for contempt in this context. Defendants do not normally flout the orders of the courts in a “serious” or “contumacious” manner. OCS v Dadi therefore acts as an important reminder, not only of the relevant principles, but also of the practical advice that lawyers can offer their clients if they find themselves in this unenviable position. Early admissions, an unequivocal apology, and cooperation with both the court and the claimant may not keep a client out of prison, but it may nonetheless substantially reduce the length of any sentence.

The full judgment can be read here.

 

Clerks

Staff