Marine transport company Dockwise loses ground-breaking legal action to gain access to ex-CEO Philip Adkins's emails
Friday 02 November 2012
A leading marine transport company has lost a ground-breaking legal bid to gain access to a former chief executive's emails.
In a significant ruling for business and new technology, a High Court judge declared the content of emails is "not property", and therefore the company did not have an enforceable proprietary claim to see the documents.
The case, which raises the question whether the law is out of line with 21st century technology, emerged after Dutch-based company Dockwise took over rival Fairstar Heavy Transport in a hostile takeover bid in July this year.
Both companies specialise in the sea transport of heavy and valuable cargoes, including drilling rigs.
Mr Justice Edwards-Stuart rejected a claim by the new owners of Fairstar that they were legally entitled to see the content of emails sent and received by Philip Adkins, Fairstar's chief executive before the takeover.
The judge, sitting in the Technology and Construction Court in London, said the new owners were asserting that Mr Adkins never revealed during the run-up to the takeover that Fairstar had incurred a "very substanital" liability to a Chinese shipyard.
They argued that access to his emails, now stored in England, was necessary to see what had gone on. Mr Adkins disputes the allegations.
The judge said it was contended that the emails had been created by, or come into the possession of, Mr Adkins while he was acting for Fairstar and their content was now the "property" of the company.
Rejecting the submission, the judge ruled: "It is clear that the preponderance of (legal) authority points strongly against there being any proprietary right in the content of information, and this must apply to the content of an email, although I would not go so far as to say that this is now settled law."
However the Fairstar assertion that there was a proprietary right "is not supported by any authority binding on me".
The judge said: "There are no compelling practical reasons that support the existence of a proprietary right - indeed, practical considerations militate against it."
If email content was capable in law of being property, there would be five possible options of ownership - and all were either impractical or unrealistic.
The judge said he rejected the plea that "the law is out of line with the state of technology in the 21st century".
Ince & Co, solicitors acting for Fairstar, said later: "This is an issue of great significance to businessmen in general and to Fairstar in particular, and Fairstar is applying for pemission to appeal."
Mr Adkins' lawyer, John Kelly, a Schillings partner, said: "This is an important decision and reaffirms the longstanding principle that information is not property."
In his written ruling, the judge said the law did provide protection against the misuse of information contained in emails, but he was expressing no view as to whether or not there was any other ground on which today's application could have been made.
The judge said of his conclusions: "I have to say that this is not a result that I view with any enthusiasm in the circumstances of this particular case."
The judge said Mr Adkins was not directly employed by Fairstar, but by Cadenza Management Ltd, a Jersey-registered company which he controlled and had contracted his services to Fairstar.
A consequence of him not being directly employed was that all incoming emails addressed to him at his Fairstar email address were automatically forwarded to his private email address at Cadenza, said the judge.
Fairstar now said that forwarded incoming emails were automatically deleted from Fairstar's server. That was not accepted by Mr Adkins.
Outgoing emails were sent directly from Mr Adkins' own computer. Unless copied to someone at Fairstar, no copies would have reached Fairstar's server.
The judge said it was Fairstar's case that it needed acccess to the Adkins emails to help it respond to an investigation of Fairstar's 2011 accounts by the stock exchange authorities in Oslo, Norway, where the company's shares are listed.
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