Former managing director diverted clients to her own business

What can you do if a former employee or director leaves your business and begins diverting clients to their own company? In a recent case, our client found themselves in this very scenario. We were able to take urgent steps on their behalf to protect their business.

The claim arose from the covert diversion of business by our client’s former MD to her own business, which she had set up in competition. She had also begun dealing with the customers of our client, in breach of her restrictive covenants. Losses were calculated to be approximately £500,000.

What was particularly concerning to our client was that they believed she had unlawfully taken confidential information. When she refused to return the stolen materials, we helped our client make an urgent application to court.

We made a without-notice application – one which we were not required to give notice of – for a search order and interim injunction. The applications succeeded, and we obtained the orders sought. The court ordered that we were entitled to enter her premises to search for and retrieve any of our client’s property which she was holding.

Subsequently, we obtained judgment on liability against her. She was ordered to pay our client’s costs up to and including the hearing, which amounted to approximately £123,000. Terms were subsequently agreed, with her paying a six-figure sum in settlement.