CITATION: IT/Net Inc. v. Doucette, 2007 ONCA 52

DATE: 20070129

DOCKET: C43418

COURT OF APPEAL FOR ONTARIO

RE:

IT/NET INC. (Plaintiff/Appellant) v. CARL DOUCETTE and FUJITSU CONSULTING (CANADA) INC., formerly DMR CONSULTING INC. (Defendants/Respondents)

BEFORE:

O’CONNOR A.C.J.O., FELDMAN and ROULEAU JJ.A.

COUNSEL:

Jock Climie

for the appellant

David Elliott

for the respondent

HEARD:

RELEASED ORALLY:

January 25, 2007

January 25, 2007

On appeal from the judgment of Justice Roydon J. Kealey of the Superior Court of Justice dated March 22, 2005.

E N D O R S E M E N T

[1] The appellant raises two grounds of appeal. First, the appellant argues that the trial judge erred in failing to find that the respondent breached a non-solicitation clause in his employment agreement. That clause reads in part as follows:

2.3 … You will not on behalf of any company or partnership, attempt to solicit business from any IT/NET client or prospect in effect, we want to ensure that you will not use any “insider” knowledge for a period of twelve months.

[2] In reaching his conclusion, the trial judge made several critical findings of fact. To start, he found that at the time the respondent left the appellant’s employ, it was far from certain that the appellant was going to obtain the contract with the Department of National Defence (“DND”). The trial judge accepted Colonel Bernier’s evidence that he was ambivalent about how he would proceed.

[3] Importantly, the trial judge also found that the respondent did not attempt to solicit the DND business opportunity for his new employer, DMR Consulting. Rather, he was approached by Colonel Bernier with the suggestion that DMR become involved. Only then did the respondent discuss the opportunity with DMR. Moreover, the DMR proposal was based on information that Colonel Bernier provided to DMR in the form of a Statement of Work.

[4] These findings of fact were supported by the evidence. We see no merit to this ground of appeal. In reaching this conclusion, we should not be taken as saying that the non-solicitation clause in issue is unenforceable. We are saying nothing more than that the facts as found by the trial judge do not constitute a breach.

[5] The appellant’s second argument is that the trial judge erred in not finding that the respondent disclosed confidential information to DMR. The confidential information that the appellant relies on has two parts; the fact that DND intended to let a Request for Proposal contract, and that, in addition, DND had discussed the nature of that contract with the appellant. DND had not disclosed its intention or the nature of the contract to anyone other than the appellant and its employees, one of whom was the respondent.

[6] However, the information relied upon by the appellant would only have an aspect of confidentiality so long as DND did not disclose it to others which, of course, it was free to do. The respondent did not disclose the information about DND’s opportunity to DMR until after Colonel Bernier had raised the subject with him and inquired if DMR would be interested in the contract. Clearly, DND, the proprietor of the information, wanted it to be disclosed to DMR. In these circumstances, we do not think that the respondent can be said to have misused confidential information.

[7] Further, Colonel Bernier provided DMR, through the respondent, with a Statement of Work containing details to be used in preparing the proposal. We do not agree with the appellant that the use of that information in the proposal constituted a misuse of confidential information by the respondent.

[8] In the result, we agree with the trial judge that the respondent did not misuse confidential information. The appeal is, therefore, dismissed. Costs to the respondent are fixed in the amount of $12,000, inclusive of disbursements and GST.

“Dennis O’Connor A.C.J.O.”

“K. Feldman J.A.”

“Paul Rouleau J.A.”