A judge has ruled that employees can design a product that may, one day, be competitive with their employers, without being in breach of contract.
Field Fisher Waterhouse partner and head of intellectual property Nick Rose says the decision clarifies the line between preparing to compete and direct competition.
‘The law has always allowed employees to take steps to prepare to compete with their employers before they leave a job – arranging finance and premises and so forth,’ he says.
‘In this ruling, the judge was clear that commissioning a competitive design is part of preparing to compete, not a competitive action in itself.’
The ruling was handed down in a trial that saw entrepreneur Mitchell Tunnard taken to court by former employer Helmet Integrated Systems. Tunnard was a salesman for the company when he came up with an idea for a modular fire helmet. Tunnard commissioned designers to take the idea to concept stage while still working at HIS. He then left the company to develop and market the helmet.
HIS alleged personal dishonesty and unregistered design right infringement, but the judgement found this to be totally false.
Rose points out that it may be more difficult for designers to defend an action like this than non-design employees.