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Sam Neaman victorious in High Court claim

Threlfall v ECD Insight Ltd & Anr [2012] EWHC 3543

This judgment is an important addition to the caselaw on the meaning of “competition” with a former employer. It is of special note to those involved in disputes where the former employee was a “one-person department”, or was the only person carrying out a particular function or activity prior to their departure.

Sam Neaman’s client, the Claimant, was a business news broadcast journalist with considerable experience as a TV News “anchorman”, and a track record in high-level and high-profile Event Moderation for international organisations. He was head-hunted to join the first Defendant (“ECD”), a small communications consultancy. Prior to his employment, Event Moderation had not formed part of ECD’s business. After joining ECD, the Claimant carried out a small number of such moderations in the course of his employment, and the court found that Event Moderation accordingly became a “minor part” of ECD’s business activities. After six years the Claimant left ECD and went back into TV journalism as the “anchorman” for Reuters News. He continued to carry out Event Moderation after he left. ECD, however, carried out no further moderation work.

The Claimant’s entitlement to valuable post-termination benefits depended on whether his moderation activities post-termination constituted “competition” with the activities of ECD.

The Judge held that they did not. Citing with approval the case of Phoenix Partners Group LLP v Asoyag [2010] EWHC 846, she held that although Event Moderation became a business activity of ECD while the Claimant was employed,

“[it] was only carried out by ECD because it was a personal sideline of the Claimant’s. It was not carried out by ECD before the Claimant did it, and it has not been carried out since he left. Therefore any event moderation work carried out by the Claimant after he left ECD would not be ‘in competition with’ a business activity of ECD” [paragraph 99]

Whilst the Claimant was found to have been in technical breach of his duties of fidelity during his notice period, ECD were awarded only nominal damages of £5.

Read the Judgment here.

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