Experienced litigation solicitors know when to fight and when to compromise. Getting such decisions wrong can have very serious consequences, as one High Court case concerning employee misuse of information underlined.

Two employees of an asset management company had, following a trial, been found to have unlawfully copied and retained confidential information on leaving their jobs. One of them had downloaded thousands of confidential documents onto USB drives and had subsequently lied in an attempt to cover his tracks. The other had facilitated his illicit access by copying files onto a shared drive.

However, a judge found that their employer had failed to establish that it suffered any loss due to their misuse of information or that they made any gain. The employer was thus awarded only nominal damages. In those circumstances, an issue arose as to who should have to pay the substantial legal costs of the case.

The Court noted that, in a commercial case, an award of nominal damages counts as a defeat. Despite his initial lies, the employee who was most heavily involved had admitted wrongdoing early on in the proceedings, although the other had contested liability. Shortly before judgment was given, they had jointly made a formal offer to settle the claim for £1.5 million. That offer was not accepted by the employer and, in the circumstances, it was ordered to pay the lion’s share of legal costs.

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