A £2.1M Lesson: The Power of Confidential Information

A recent High Court ruling¹ serves as a stark reminder of the importance of respecting confidential business information. Hambro Perks, was found guilty of breaching confidentiality and ordered to pay over £2 million in damages after misappropriating an inventor’s idea for care home software². This case underscores that while patents are a powerful tool for safeguarding innovation, confidentiality can also be a powerful IP asset for securing proprietary ideas. Documentation of discussions showing that the information has a “quality of confidentiality” can provide decisive evidence of a breach of confidence.

The Case: A Breach of Confidence

Inventor Tony Gifford developed True View Care (TVC), a software system designed to revolutionise care home operations by breaking down patient-related tasks and allocating them to the best-suited carers, rather than allocating all care tasks for a particular patient to the same carer. Gifford disclosed confidential details about his invention to Hambro Perks during meetings with its then-boss, Dominic Perks. Despite initially praising the concept as “unique” and “exciting”, the venture capital firm later lost interest. Then, a competing product, WeCare/Vida, was launched by DHV Technologies, a subsidiary of Digital Home Visits founded by Perks and Naushard Jabir, an investor adviser for Hambro Perks.

Justice Calver ruled that Hambro Perks had misused Gifford’s confidential information in developing the rival product. He found that WeCare/Vida was “built on the TVC design” and that Perks had “cut out” Gifford and blocked his ability to obtain funding elsewhere by creating competition for his product. While the two products were different in some aspects, the ruling found that, in fundamental respects, the WeCare/Vida design closely reflected the TVC design.

The full ruling details considerations for whether there was the necessary quality of confidence  around the meetings between the parties. A “quality of confidence” may be present when information is not public property and public knowledge³. Someone must have added some thought and effort to information that is already available in the public domain in order to convey a quality of confidence to that information.  As Justice Megarry stated in Coco v A N Clark (Engineering) Limited⁴, “whether it is described as originality or novelty or ingenuity or otherwise, I think there must be some product of the human brain which suffices to confer a confidential nature upon the information”.

Calver J commented that the information about the TVC system and the concept as a whole “undoubtedly had the necessary quality of confidence³”. The documents shared with the Defendant “contained valuable technical information collated and devised by Mr. Gifford using his skill, effort and time…”. He also commented that “to suggest that … these documents, containing the accumulated knowledge of how a care home works and how the workflows could best be managed, were not confidential to Mr. Gifford – who had spent time, effort, money and his brainpower in collating it – is absurd”.

Key Takeaways for Businesses and Innovators

This case highlights important intellectual property considerations for startups and businesses engaging with investors and potential partners, in relation to confidential information:

1. Documentation is key – To protect confidential information effectively, businesses must clearly and securely document and manage their information, including who has access to it, when it was shared, and under what terms. Detailed records can strengthen legal claims in the event of a dispute.
2. Confidentiality agreements matter – Having robust non-disclosure agreements (NDAs) in place may help to provide legal recourse if confidential information is misappropriated. Companies should ensure NDAs are clear, comprehensive, and enforceable.
3. Confidential information can be powerful – Unlike patents, which require public disclosure, confidential information can allow businesses to maintain exclusivity over valuable information. In this case, the information was considered to be the result of the Claimant’s time, effort, money and brainpower, supporting the finding that the invention was intended to be confidential.
4. Investor due diligence is essential – Innovators must exercise caution when sharing sensitive business information, even with reputable investors. Performing background checks on potential partners and limiting disclosures to essential details until formal agreements are in place can reduce risks.
5. Businesses should be mindful of new employees’ knowledge – consideration should be given to information provided by a new employee to a business. They should check that it is not confidential information brought over from a previous employer, and may consider including discussions of confidential information handling during the employee induction process.

This ruling reinforces that failing to patent an invention is not necessarily the end of the road for IP protection. With appropriate alternative legal safeguards, in this case the use of confidential information, businesses can successfully defend their innovations and hold those who misuse confidential information accountable.

This article was written by Patent Director Janine Swarbrick.

Refs:

1. Henderson & Jones Ltd v Salica Investments Ltd & Ors [2025] EWHC 475 (Comm) (03 March 2025) https://www.bailii.org/ew/cases/EWHC/Comm/2025/475.html
2. The Times, “Hambro Perks must pay £2m for stealing care home invention”, 3 March 2025, https://www.thetimes.com/article/061a1c8c-25bb-4a61-b4c2-bb77a6bcf392?shareToken=537593eecf0cf1e45a7c852675129946
3. Saltman Engineering Co Limited v Campbell Engineering Co Limited [1948] 65 RPC 203
4. Coco v AN Clark (Engineers) Ltd [1968] FSR 415, [1969] RPC 41