Best Buy Electric Co Ltd v Built-In Pro Ltd [2025] 2 HKLRD 1157, [2025] HKCFI 1929 (Pauline Leung, Brian Tsui, Chelsea Lau)
Brian Tsui represented the plaintiff and Pauline Leung and Chelsea Lau represented the defendant in Best Buy Electric Co Ltd v Built-In Pro Ltd [2025] 2 HKLRD 1157, [2025] HKCFI 1929.
P operated a business providing kitchen solutions and appliances of high-end brands or rare models. D was a competitor of P. P produced quotations for clients electronically, which were digitally stored. In May 2024, a client of P was approached by a staff of D with an offer identical to P’s except with a lower price. It then emerged that P’s database had been hacked. D had made use of the information released. P brought these proceedings against D for, inter alia, breach of confidence. The present hearing dealt with P’s applications for: (i) the continuation of an interlocutory injunction previously granted, restraining D from disclosing or using P’s confidential information and conducting or soliciting any business from a person whose details appeared in such information; and (ii) the grant of a disclosure order that D disclose, inter alia, all confidential information that D had given or divulged to others and who D had approached with such information.
Held, granting the interlocutory injunction and disclosure order, that:
(1) This case involved interim relief that would effectively finally dispose of the action. In such circumstances, the American Cyanamid principles were to be modified. The court should approach the matter on the broad principle that it should endeavour to do what would avoid injustice as far as possible, and the plaintiff had to show at least that he was likely to succeed at trial. A stronger evidential case was required than in a normal application for interlocutory injunction (Sim Kon Fah v JBPB & Co [2011] 4 HKLRD 45 applied). (See para.28.)
(2) Further, the disclosure order sought was a mandatory injunction in nature. P had to show a strong prima facie case and the Court must feel a high degree of assurance that, at trial, it would appear the injunction was rightly granted. (See para.29.)
(3) The elements for a claim of breach of confidence were that: (i) the confidential information must be identified; (ii) the information must have the necessary quality of confidence; (iii) the information must be imparted in circumstances importing an obligation of confidence; and (iv) there must have been an unauthorised use of that information to the detriment of the party communicating it. A prior confidential relationship was no longer necessary for a duty of confidence to arise. It would be a breach of confidence for a defendant, without authority, to look at documents which he must appreciate would be confidential. A plaintiff would be entitled to obtain an injunction to stop the defendant from repeating his action and to restrain the passing on or using of such information (Campbell v MGN Ltd [2004] 2 AC 457, Imerman v Tchenguiz [2011] 2 WLR 592, Sim Kon Fah v JBPB & Co [2011] 4 HKLRD 45, Devere Group Hong Kong Ltd v Nicholas Edward John Smith (HCA 1950/2013, [2014] HKEC 570) applied). (See paras.32-41.)
(4) On the facts, P had met the higher evidential threshold and shown a strong case of breach of confidence and for an injunction to be granted. The information was contained in quotations, which were clearly private and confidential documents. The information would allow D to entice away P’s clients by undercutting P. On the evidence, D had conducted the hacking activities, which demonstrated D’s low commercial morality and how much it wanted the confidential information. D must have been aware that P expected privacy. The fact that the information had been made public by a hack did not assist D. P had adduced compelling evidence that D had intentionally and without authorisation taken steps to *1159 obtain the confidential information. P was entitled to an injunction restraining D from looking at the confidential information again, regardless of whether D intended to reveal the contents to a third party. Monetary compensation would not be a sufficient remedy as quantum would be very difficult to compute and D would not suffer any significant loss if it was enjoined from using the confidential information which it should never have had. The balance of convenience was in favour of a grant of interlocutory injunction. D’s requests for exclusion of certain of its existing clients from the injunction and imposing an expiry date for the injunction were rejected. (See paras.42-61, 70.)
(5) As for the disclosure order, P needed the disclosure to take preventative action against further misuse of the confidential information and D had a duty to assist P by disclosing other wrongdoers and potential wrongdoers. P was also entitled to mitigate its loss and protect its business interest; knowledge of who D had approached would help P to do so (AXA China Region Insurance Co Ltd v Pacific Century Insurance Co Ltd [2003] 3 HKC 1 applied). (See paras.62-67.)
[The above is excerpted from the headnote to the report in HKLRD.]
