Deutsche Bank is seeking damages from a former senior executive it accuses of breaching confidentiality provisions in his employment contract and the Corporations Act 2001 after emailing documents from the company to his partner's laptop
However, the case has taken an unusual turn.
The former Deutsche Bank executive, Ross Johnstone, is seeking to have the legality of his employment contract with the bank tested by the court.
Johnstone had sought an order from the NSW Industrial Relations Commission (IRC) to have parts of the contract pertaining to his confidentiality obligations altered as part of a separate action he had taken against the bank. However the court has now agreed to hear the matter alongside the civil action.
Lawyers representing Johnstone claimed the contract's definition of confidential information was unlawful, overly restricting their client's ability to apply his trade.
Johnstone admits emailing some documents to his partner in November 2001 but has claimed that it was inorder to work on the material over the weekend.
Deutsche Bank alleges that Johnstone emailed documents out of the company again in February 2002. They further alleged that the documents allowed him to assist his new employer, Salomon Smith Barney (SSB) to secure a mandate from Cheung Kong Infrastructure (CKI) to advise it on a potential acquisition of Citipower. While employed at Deutsche Bank, Johnstone had been working on its proposal to be granted the mandate.
Johnstone has admitted reacquiring the documents sent November 2001 in April 2002 and copying them to his system at SSB, but his lawyers contend that they contained information that was trivial, not commercially valuable and available in the public domain.
Johnstone said he could not recall sending any documents on the second occasion in February.
Internet Industry Association (IIA) chairman, Peter Coroneos said company's need to ensure that their confidentiality agreements strong enough to protect their intellectual property when dealing with senior executives and that they have adequate training programs to make employees aware of company policies on use of company IT equipment.
"Sometimes it just helps to restate the law just to help focus people," said Coroneos.
-Perhaps a good company policy ought to say that all documents belong to the business, not to individuals, and no unauthorised removal by any means is permitted and that systems are in place to help detect unauthorised uses of equipment," he added.
According to Coroneos, executives in many large corporations have to go through processes to ensure that company information is protected when they depart.
However the circumstances in which senior executives depart companies might not always be conducive to such measures.
It appears that the final days of Johnstone's employment with Deutsche Bank may provide an example. Deutsche Bank said it terminated Johnstone's employment, alleging he refused to show up at work, feigning to believe that the bank had already fired him.
According to recent reports banking industry analysts believe that investment bankers' dependence on their business relationships would probably make the copy and transfer of company documents common. However instances of it were difficult to prove.
Investment bank Macquarie told the The Australian Financial Review it uses legal and practical measures to protect documents that are difficult for employees to circumvent. It said that all employees' document copy and transfer activities are recorded by the banks' information systems.
However computer forensic consultants command a heavy premium for their work. According to networking security sources, computer forensic experts can charge upwards of AU$250 to AU$400 per hour depending on the complexity of the network and the problem that is involved in the work.
Coroneos concedes that Internet based technologies can increase the scale of abuses but warns against demonising the medium over instances in which it occurs.
"Technology makes everything easier, it makes productive acts easier and it also makes criminality easier, therefore the technology is actually neutral in respect of this," he said.
There may be some irony in that Johnstone emailed the documents at the centre of the furore to his partner's place of employment business media company Terrapinn Australia. Terrapinn currently lists storage and networking solution providers among its clients.
