Parties to bring in short minutes to give effect to these reasons, see [676].
Catchwords:
CONSPIRACY TO INJURE BY UNLAWFUL MEANS – electronics engineers and funder establish company to develop new products – designer is employee and shareholder – shareholder agreement imposes obligations for trade secrets and confidential information – Taiwanese manufacturer engaged – products launched and gain international interest – directors fall out over money – funder jettisoned from board and bank accounts – funder open to buy out – fellow directors prefer to ‘phoenix’ – raise false invoice by designer – register false security interest – appoint administrator without notice – set up new company without funder – continue to exploit company’s products and customer base – funder proposes deed of company arrangement (DOCA) – directors frustrate DOCA – delete data – ‘warehouse’ trademark and domain name – revoke shareholders agreement – release designer from obligations – assert products designed by Taiwanese manufacturer all along.
COPYRIGHT – mining telecommunications – employee designs electronic devices – related company claims R&D grant – employee claims Taiwanese manufacturer undertook design work – use of ODMs and OEMs – employer seeks delivery up of PCB assemblies, schematics and documentation – employee denies works exist – expert evidence and contemporaneous documents suggest otherwise – principles at [554]-[566] – copyright vests in employer – copyright not assigned to related company – orders made for delivery up.
COPYRIGHT – software – software developer writes software for no fee and becomes employee and shareholder – implied licence – exclusive licence –whether changes after became employee were “original” at [616]-[618] – licence included right to alter software at [227]-[230], [621]-[623] – licensee entitled to delivery up of source code.
TORT – conspiracy to injure by unlawful means – damages the gist of the action at [650]-[659] – plaintiffs do not plead or adduce evidence of damage – fusion fallacy – conspiracy claim fails on this basis.
CORPORATIONS – oppression – Corporations Act 2001 (Cth), ss 232, 233 – minority shareholder entitled to buy-out majority shareholders.
CONFIDENTIAL INFORMATION – TRADE SECRETS – shareholders agreement imposes duties of confidentiality – directors and employee also bound by equitable obligations of confidence – company entitled to delivery up, damages and/or account.
[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.
[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.
[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.
Consideration
[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.
[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.
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Details
AGLC
Metstech Pty Ltd v Park [2022] NSWSC 1667
Case
[2022] NSWSC 1667
Decision Date
CaseChat Overview and Summary
The case of Metstech Pty Ltd v Park was heard in the Federal Court of Australia, involving a dispute between Metstech, an Australian company, and its shareholders and directors, including the defendant Park. Metstech was established to develop new products in the electronics engineering field, with Park and other directors holding shares and positions within the company. The dispute arose from disagreements among the shareholders and directors, leading to the ousting of Park from the board and bank accounts, and subsequent actions to exclude Park from the company.
The primary legal issues before the court included whether the defendants conspired to injure Park by unlawful means, the ownership of copyright in various electronic devices and software developed by Park, the existence of an oppressive conduct under the Corporations Act 2001, and the obligations concerning confidential information and trade secrets. The court needed to determine the validity of the conspiracy claim, the rightful owner of the copyright, the applicability of oppression provisions, and the enforcement of confidentiality obligations.
The court ruled that the conspiracy claim failed as the plaintiffs did not provide evidence of actual damage, which is a fundamental element of the tort. Regarding copyright, the court found that the copyright in the electronic devices and software indeed vested in Metstech, and ordered the delivery up of the relevant materials. The court also held that Park was entitled to a buy-out under the Corporations Act 2001, but this was not exercised due to the actions of the other directors. Additionally, the court recognised the obligations of confidentiality and ordered the delivery up of certain documents and materials, along with damages and/or an account for the misuse of confidential information.
The court made several orders, including the delivery up of various documents and materials related to the copyright, the enforcement of the buy-out right under the Corporations Act, and the imposition of confidentiality obligations. The court also ordered damages for the misuse of confidential information, reflecting its findings on the various claims presented in the case.