Australian Administration Services Pty Ltd v Korchinski [2007] FCA 12

FEDERAL COURT OF AUSTRALIA

Australian Administration Services Pty Ltd v Korchinski [2007] FCA 12

AUSTRALIAN ADMINISTRATION SERVICES PTY LTD AND AAS SUPERANNUATION SERVICES PTY LTD v STUART KORCHINSKI AND KAZ GROUP PTY LIMITED NSD 2543 OF 2006

stone j

15 JANUARY 2007

SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY NSD 2543 OF 2006

BETWEEN: AUSTRALIAN ADMINISTRATION SERVICES PTY LTD

First Applicant

AAS SUPERANNUATION SERVICES PTY LTD

Second Applicant

AND: STUART KORCHINSKI

First Respondent

KAZ GROUP PTY LIMITED

Second Respondent

JUDGE: STONE J

DATE OF ORDER: 15 JANUARY 2007

WHERE MADE: SYDNEY

THE COURT ORDERS THAT:

1. The applicants' amended notice of motion filed on 29 December 2006 be dismissed with costs. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY NSD2543 OF 2006

BETWEEN: AUSTRALIAN ADMINISTRATION SERVICES PTY LTD

First Applicant

AAS SUPERANNUATION SERVICES PTY LTD

Second Applicant

AND: STUART KORCHINSKI

First Respondent

KAZ GROUP PTY LIMITED

Second Respondent

JUDGE: stone j

DATE: 15 JANUARY 2007

PLACE: SYDNEY

REASONS FOR JUDGMENT

Introduction 1 This proceeding concerns confidential information of the first and second applicants to which the first respondent had access in his capacity as an employee of the second respondent. Although employed by the second respondent, at all material times, the first respondent, Mr Korchinski was deployed to provide services for the applicants. 2 In brief the applicants claim that shortly before leaving their service to commence employment with CitiStreet Pty Ltd, a major competitor of the applicants, Mr Korchinski, downloaded confidential information belonging to the applicants onto a portable hard drive (PHD) owned by the first applicant, but of which the senior executives of the applicants were unaware. They say that, after they became aware of the existence of the PHD and asked Mr Korchinski to return it to them he failed to do so by the date specified. Eventually he did return it but not before deleting the information, downloading music and video files to the PHD and then reformatting it. They say that Mr Korchinski has failed to disclose to the applicants why he required the PHD and the work he had undertaken with the device. This failure and the circumstances surrounding Mr Korchinski's dealings with the applicants since he has committed to a position with CitiStreet have raised their concern that Mr Korchinski has transferred the information to a computer and still has access to it and that it could be used to their detriment and to the advantage of a competitor. The applicants claim that Mr Korchinski has acted in breach of his duty of confidentiality, his fiduciary duties and in breach of copyright. 3 The second respondent, KAZ Group Pty Limited ('KAZ') was joined to the proceedings solely to protect the confidentiality of some of its information held on Mr Korchinski's laptop. This need was met by undertakings given by the other parties and KAZ otherwise took no part in the interlocutory proceeding. 4 By notice of motion the applicants now seek interlocutory orders which include restraining the respondent from performing services "directly or indirectly" for CitiStreet Australia Pty Ltd or any of its related bodies corporate in Australia. They also seek to restrain the respondent from performing services directly or indirectly for a direct competitor of the businesses of the applicants in Australia.