Verint Systems (Australia) Pty Ltd v Sutherland [2019] NSWSC 882

Supreme Court New South Wales

Medium Neutral Citation: Verint Systems (Australia) Pty Ltd v Sutherland [2019] NSWSC 882 Hearing dates: 4, 5 & 8 July 2019 Date of orders: 15 July 2019 Decision date: 26 July 2019 Jurisdiction: Equity - Duty List Before: Slattery J Decision: Plaintiff's non-solicitation and confidentiality undertakings noted. Also noted that the plaintiff has paid the bonus amount to the defendant on 12 July 2019. The defendant is restrained from commencing employment with the named competitor until 5 August 2019 but not beyond that date. Matter referred to the Expedition List. Costs are reserved. Catchwords: CONTRACTS – Restraint of trade – Employment contracts – the defendant/employee leaves his employment with the plaintiff – the plaintiff sells and supports software used by businesses to manage call centres, call recording, work force management, speech analytics and automation – the defendant initially proposes to work for a named direct competitor of the plaintiff – the employment agreement between the plaintiff and the defendant contains post-employment non-solicitation and confidentiality restraints – the employment agreement also contains a non-competition restraint on a former employee working for a competitor for up to 12 months after the termination of his employment – plaintiff places defendant on "garden leave" on 22 May 2019 – the plaintiff's employment with defendant formally ended on 22 June 2019 – the defendant proposes to commence employment with the named competitor immediately, unless restrained – the defendant's proposed employment is prima facie in breach of the non-competition restraint – an issue for final hearing is whether the plaintiff's non-competition restraint is enforceable against the defendant or will be read down under the Restraints of Trade Act 1975 – plaintiff offers undertakings as to damages – plaintiff accelerates the payment of post-employment bonuses to the defendant – defendant offers non-solicitation and confidentiality undertakings – whether there is a serious question to be tried – what is the balance of convenience in the circumstances. Legislation Cited: Restraints of Trade Act 1976, s 4 Supreme Court Act 1970, s 66(4) Cases Cited: AT Kearney Australia Pty Ltd v Crepaldi & Ors [2006] NSWSC 23 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 Australian Broadcasting Corporation v O'Neill (2006) 227 CLR 57 Beecham Group Ltd v Bristol Laboratories Pty Ltd (1968) 118 CLR 618 Beese v Woodhouse [1970] 1 All ER 769 Buckley v Tutty (1971) 125 CLR 353 Collier v Howard (unreported, McLelland CJ in Eq., NSWSC, 23 April 1996) DP World Sydney Limited v Guy (2016) 262 IR 156 Francome v Mirror Group Newspapers Ltd [1984] 1 WLR 892 Isaac v Dargan Financial Pty Ltd ATF The Dargan Financial Discretionary Trust (ABN 68 702 047 521) (trading under the name of Home Loan Experts) [2018] NSWCA 163 John Fairfax Publications Pty Ltd v Birt [2006] NSWSC 995 Kolback Securities Ltd v Epoch Mining NL (1987) 8 NSWLR 533 Koops Martin v Reeves [2006] NSWSC 449 Littlewoods Organisation Ltd v Harris [1977] 1 WLR 1472 Lyreco Pty Ltd v Schoolworks Australia Pty Ltd [2006] NSWSC 1184 Metcash Ltd v Joao Lewis Jardin (No. 3) (2010) 273 ALR 407 McCarty v North Sydney Municipal Council (1918) 18 SR (NSW) 210 Miles v Genesys Wealth Advisers Limited (2009) 201 IR 1 SAI Global Property Division Pty Ltd (ACN 089 586 872) v Jones & Ors [2018] NSWSC 438 Stacks/Taree Pty Ltd v Marshall (No 2) [2010] NSWSC 77 Woolworths Limited v Mark Konrad Olson [2004] NSWCA 372 Texts Cited: JD Heydon, MJ Leeming and PG Turner, Meagher, Gummow & Lehane's Equity: Doctrines & Remedies (5th ed 2014, LexisNexis Butterworths) Category: Consequential orders (other than Costs) Parties: Plaintiff: Verint Systems (Australia) Pty Ltd (ACN 092 740 577) Defendant: Levi Sutherland Representation: Counsel: Plaintiff: V. Bulut Defendant: B. Ilkovski