Gurgaon court restrains Club Factory from divulging Snapdeal trade secrets

By

Isabelle Crossley

Published
Feb 25, 2020

A Gurgaon court ruled to restrain a former Snapdeal employee from sharing or using the e-commerce business’ trade secrets, after taking a new job at rival fashion retailer, Club Factory.

 
Snapdeal has accused Chinese-owned Club Factory of attempting to poach its employees and clients to gain its trade secrets. The business approached a Gurgaon court in an attempt to stop a former employee from sharing any information with new employer Club Factory, the Press Trust of India reported. 
 
The Gurgaon court’s civil judge, Suyasha Jawa, ruled in favour of Snapdeal and ordered Club Factory and the employee in question to refrain from using any of Snapdeal’s trade information. The court stated in its order that business ethics demand that ex-employees do not leak information to rival businesses.

"Appreciating the peculiar facts and circumstances of the instant case, it appears necessary to exercise the discretion in granting injunction in favour of the plaintiff [Snapdeal] to restrain defendants from sharing, divulging, using or utilising trade secrets, financial data and confidential information of plaintiff company in their access, which may cause harm to the reputation and goodwill of plaintiff company,” said the court’s order, the Press Trust of India reported.

"Such information may also be refrained from being used in approaching, contacting, soliciting, enticing, inducing the common client/customer/business partners.”
 
The court also stated that Club Factory is free to pursue clients in an ethical manner, as long as it does not use Snapdeal’s confidential information to do so. The Gurgaon court will hear the case again on March 21.