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2015 MarsdenLR 128
HIGH COURT MALAYA SHAH ALAM
LINK 2020 MALAYSIA SDN BHD – Appellant
Versus
DIGI TELECOMMUNICATION SDN BHD – Respondent
[Civil Suit No: 22-1801-2009]
A party alleging breach of confidentiality must establish that the defendant used the confidential information provided, which necessitates a clear evidential link between the information and the alleged misuse.
Headnote:(A) Confidential Information Law - Breach of Confidence - The plaintiff claimed damages for breach of a confidentiality agreement regarding a proposed personal accident insurance policy. The court examined the elements of breach including whether the defendant had used the information within a relevant concept paper (CP) prior to launching a competing scheme. (Paras 1, 26)
(B) Evidence and Burden of Proof - The court emphasized that the defendant was required to demonstrate that its scheme was independently developed and not derived from the plaintiff's confidential information, thus affirming that confidentiality needs to be upheld unless proven otherwise. (Paras 19, 24)
(C) Ownership of Concept Paper - The court addressed whether the plaintiff was indeed the owner of the concept paper submitted to the defendant, evaluating detailed evidence regarding its creation and evolution. (Paras 7, 10)
Facts of the case:
The case arose from a cover letter from a government department proposing a personal accident insurance policy. The plaintiff alleged that the defendant had similar coverage under development prior to accepting the proposal and used confidential information without permission. The defendant claimed its scheme was developed prior to the proposal. (Paras 1, 2)
Findings of Court:
The court found that the plaintiff was unable to prove that the defendant had used the information in the concept paper to develop its product, dismissing the plaintiff's claims with costs. (Para 30)
Issues: The main issues included the confidentiality of information, the independent development of the defendant's scheme, and whether the plaintiff could claim ownership over the information provided to the defendant. (Para 4)
Ratio Decidendi: The court ruled that without sufficient evidence showing the defendant’s reliance on the plaintiff's confidential information, the claim must be dismissed; the evidentiary burden lies in proving misuse of confidential information. (Paras 24, 30)
Result: Claim dismissed with costs of RM70,000.00.
| Table of Content |
|---|
| 1. overview of plaintiff's claims and defendant's response. (Para 1 , 2 , 3) |
| 2. breach of confidentiality and legal nuances. (Para 4 , 5 , 6) |
| 3. evidence regarding the ownership of the concept paper. (Para 7 , 10 , 11) |
| 4. court's analysis on reception and acknowledgment of documents. (Para 14 , 15 , 16) |
| 5. development of defendant’s insurance scheme. (Para 19 , 24) |
[1] The plaintiff's case flows from a cover letter dated 28 May 2008 sent from Prime Minister's Department (PMD) (B-26-27) addressed to three telecommunication companies (telcos) including the defendant. In para 2 of the letter it was stated that the plaintiff had proposed the telcos "mengadakan Polisi Insuran Kemalangan Persendirian (Personal Accident Insurance Policy) yang dinamakan MyPA ... Keterangan lanjut tentang MyPA diterangkan di dalam Concept Paper on MyPA for the Nation Program An Expression of Gesture towards Nation Building yang disertakan bersama-sama dengan surat iringan ini.". Plaintiff states a confidentality agreement (CA, B-28) and Concept Paper (CP, B-29-31) were attached to PMD's letter. As reported in the Star dated 11 September 2008 (B-239) the defendant launched its free personal coverage scheme which the plaintiff claims to be similar to that in its CP. The plaintiff claims general and special damages arising from the breach.
[2] Defence of the defendant was that it had been developing a scheme involving free PA by way of short messaging service (SMS), (Digi scheme) since 2007 before receipt of PMD's letter, the letter was unsolicited and merely acknowledged receipt but the contents never accepted and that the defendant had never used or divulged the information in CP.
[3] The proposal as contained in CP was for telcos to SMS its subscribers to purchase a personal accident policy (MyPA) at a premium of RM5.90. Coverage is for 1 year of 24 hours and worldwide with an assured sum of RM10,000.00 for permanent disability and death. MyPA would be purchased from Kurnia. The scheme as launched by the defendant was for its subscribers with over three months' tenure to be entitled for free RM10,000.00 PA coverage underwritten by AIG. The service was to be made available via SMS activation. It was also stated this would strengthen customer loyalty.
Preliminary
[4] In its submission the plaintiff states its cause of action is for breach of confidential information. The defendant contends the plaintiff is estopped from relying on breach of confidential information as its cause of action as that is not its main pleaded case and not in issues to be tried and its summary of case; breach of confidential information is in an obscure paragraph and devoid of substance and particulars. The defendant refers to China Road & Bridge Corporation & Anor v. DCX Technologies Sdn Bhd, [2014] 5 MLJ 1 which states it is essential to disclose by way of pleadings what information which was disclosed was breached. The plaintiff states it has pleaded two causes of action, ie breach of confidential agreement and breach of confidential information and that the defendant had not requested for further and better particulars. It further refers to Cadbury Schweppes Inc and Another v. FBI Foods Ltd and Others [1999] 3 LRC 457, a Canadian case that breach of confidence is sui generis and arises from contract or common law.
[5] In Cadbury (supra) breach of confidentiality had been proven and the issue was the appropriate remedy to be granted. It was in that context the court stated "the equitable concept which is the basis on which the courts below granted relief, potentially runs alongside a number of other unauthorised use of disclosure of information, including actions sounding in contract, tort ..." (p 12), "whether a breach of confidence in a particular case has a contractual, tortious, proprietary or trust flavor goes to the appropriateness of a particular equitable remedy but does not limit the court's jurisdiction to grant it" (p 13) and "the sui generis
