The enforceability of non-solicitation and non-competition clauses beyond the term of employment is subject to Section 27 of the Indian Contract Act, 1872, and the need for clear identification and description of the subject matter for granting injunction.

JUDGMENT :

B.M.SHYAM PRASAD, J.

1. The plaintiffs in O.S. No.2312/2017 on the file of the 18th Addl. City Civil Judge, Bengaluru (for short 'the Civil Court') are in appeal impugning the Order dated 29.06.2018 passed by the Civil Court rejecting the appellants-plaintiffs' applications under Order XXXIX Rules 1 and 2 of the Code of Civil Procedure (for short, 'CPC').

2. The appellants and the respondents are referred to as arrayed before the Civil Court for convenience.

3. In this suit in O.S. No.2312/2017, the plaintiffs have filed three applications under Order XXXIX Rules 1 and 2 of CPC. The first of the applications viz., I.A. No.1 is filed seeking temporary injunction for restraining the defendants, and persons claiming under them, from utilizing or disclosing the confidential information as described in such application. The second application viz., I.A. No.2 is filed seeking temporary injunction restraining the defendants, and the persons claiming under them, from soliciting or inducing or encouraging the plaintiffs' employees from quitting employment with the plaintiffs and joining the defendant No.4. The third application viz., I.A. No.3 is filed for injunction restraining the defendants, either jointly or severally, and every person claiming under them, from transacting with the plaintiffs' clients and customers or plaintiffs' potential clients or customers. The suit is for similar permanent injunctive relief/s.

4. The plaintiffs' case is that the plaintiff No.1, a private limited company incorporated under the provisions of the Companies Act, 1956, is a wholly owned subsidiary of plaintiff No.2, a company incorporated under the law of the United States of America. The defendants No. 1 to 3 are the plaintiffs' erstwhile employees. The defendant No.1 joined service with plaintiff No.1 on 05.04.2012 as a Manager, but later joined plaintiff No.2 as an Engagement Manager on 26.04.2013 and was stationed in the United States of America. However, while he was working as Senior Engagement Manager, he tendered his resignation with effect from 13.01.2017. The defendant No.2 joined service with plaintiff No.1 as Senior Manager on 09.06.2008, and he continued in employment until he tendered his resignation on 05.03.2013. The defendant No.3 joined service with plaintiff No.2 as a Senior Director - Sales on 01.03.2010, and he continued in service until his resignation on 05.02.2011. The defendant Nos. 2 and 3, after ceasing to work with the plaintiffs, incorporated defendant No.4, a company under the Companies Act, 1956. The defendants, acting in violation of the terms of contract, solicited

(i) the plaintiffs' employees to quit employment and joint defendant No.4 as employees between the years 2012-13 and 2015-16,

(ii) business from the plaintiffs' clientele and customers employing plaintiffs' Proprietary Information viz., highly specialized skills of data mining and data analysis in the areas of retail, marketing, supply chain and risk analysis.

5. The plaintiffs have been able to innovate and develop analytical tools, assets and methods, which are used to provide cutting-edge, unique and specialized services. The plaintiffs are path breakers in the analytics industry because they could evolve a sustainable Global Model integrating disciplines of business, mathematics and technology. The plaintiffs, because they are able to offer cutting-edge, unique and specialized services, have an enviable clientele comprising of more than 50 of 'Fortune 500 Companies'. It would not be possible for a new entrant into the analytics industry to offer similar kind of cutting-edge, unique and specialized services without employing the analytical assets, tools and methods innovated and developed by the plaintiffs. The plaintiffs have expanded large investments of money and resources in creating, innovating and developing the necessary analytical assets, tools and methods. Therefore, these analytical assets, tools and methods constitute not just the plaint