Court of Appeal finds claimant breached search order by keyword searching and considers interplay between search and imaging orders

In a recent decision the Court of Appeal has re-emphasised that the purpose of a search order (formerly known as an Anton Piller order) is to preserve evidence that is at risk of being destroyed by a defendant or potential defendant, and that a search order does not allow a claimant to inspect documents to a greater degree than is necessary in order to determine whether documents fall within the scope of the order: TBD (Owen Holland) Ltd v Simons and others [2020] EWCA Civ 1182.

The court observed that if what is needed is a remedy to preserve evidence held on a computer or other device to ensure that it cannot be altered, destroyed or hidden then, in many cases, an order requiring the defendant to permit imaging of their digital devices will be the most effective means of achieving that objective. If an imaging order is made, it may well make a traditional search order unnecessary, or at least may enable the scope of the search order to be significantly restricted.

The Court of Appeal emphasised the highly intrusive nature of search orders, and this decision illustrates that the court will take a narrow interpretation when assessing compliance. It is also a reminder that the primary purpose of a search order is for the preservation of evidence and that when making an application (particularly where the majority of that evidence is likely to be in electronic format) applicants should carefully consider what is required to achieve that purpose.

Heather Rankin, a senior associate in our disputes team, considers the decision further below.

Background

The first defendant (Mr Simons) was a former employee of the claimant. The second defendant (G2A Limited, a UK incorporated company which is now in liquidation) was Mr Simons’s subsequent employer and a competitor of the claimant. The claimant alleged that Mr Simons had breached the terms of his employment by disclosing trade secrets or other confidential information to G2A, allowing G2A to use it, and failing to return the confidential information, and that G2A had procured Mr Simons’ breaches. The claimant also brought claims for infringement of copyright.

The claimant obtained a search order and an imaging order against (among others) Mr Simons and G2A (the “Original Defendants”), under which it obtained a large volume of documents belonging to them. In particular a number of electronic devices were imaged. Although the claimants’ solicitors proposed a long list of expansive keywords to the defendants for searching the electronic documents obtained from that imaging, Mr Simons raised objections to those keywords and the list was never agreed or approved by the Court.

The claimant’s solicitors nevertheless applied keywords to the imaged data from the defendants’ devices and reviewed certain of these documents. The claimant used the documents in question to (among other things) introduce proposed claims against a number of new defendants, including a Mr O’Boyle (referred to as “the Additional Defendants” in the judgment), and sought permission to add the Additional Defendants and bring committal proceedings against Mr O’Boyle for contempt of court.

The application to bring committal proceedings against Mr O’Boyle was based, in part, on a print-out of text messages between Mr O’Boyle and Mr Simons, referred to in the judgment as “the Transcript”, which the claimant had obtained pursuant to the court’s search and imaging orders. Mr O’Boyle challenged the application on a number of grounds including that the Transcript was subject to litigation privilege, or alternatively common interest privilege. This aspect of the judgment is the subject of a separate post on our Litigation Notes blog (which can be found here).

The judge at first instance (HHJ Keyser QC) granted permission to join the Additional Defendants, and adjourned the permission application for further consideration after the trial of the action.

Mr O’Boyle, together with certain other defendants, applied to strike out the claimant’s claim against them on the ground that the claimant had acted in breach of the search order by searching the images without the consent of the Original Defendants or an order of the court. The application came before Marcus Smith J who found that the claimant had breached the search order. He ordered the claimant to destroy any materials derived from the images and restrained it from using the materials to communicate with third parties.

The claimant appealed against the order.

Decision

The Court of Appeal dismissed the claimant’s appeal, agreeing with Marcus Smith J that the claimant had breached the terms of the search order by inspecting the documents imaged. Arnold LJ gave the leading judgment, with which David Richards and Newey LJJ agreed.

Arnold LJ emphasised that when interpreting the terms of the search order, it was necessary for the court to have regard to the purpose of a search order and that was for the preservation of evidence in circumstances where there was a justified fear of a defendant destroying evidence. Whilst he accepted the claimant’s submission that the order entitled it to inspect the documents, this only authorised inspection during the course of the search itself and not subsequently. Further, inspection was only authorised for the purpose of identifying listed items, copying them and delivering them for safekeeping. The claimant also relied upon an undertaking in the search order, arguing that it impliedly authorised inspection and use of the documents. Arnold LJ rejected that submission.

Arnold LJ also held that the order did not authorise anyone other than the computer experts to carry out an analysis of the documents. He concluded that the claimant breached the search order by inspecting both listed and non-listed items and using that information in several respects. The claimant should not have applied keyword searches to or inspected the documents without agreement from the respondents or further order of the court. The breaches were significant and very serious.

Arnold LJ commented that, in cases involving electronic documents, it may well be more appropriate for an imaging order to be sought and granted, rather than a more intrusive search order. In particular he commented that any court confronted with an application for both a search order and an imaging order should first consider whether it is prepared to grant the imaging order. If the court is satisfied that an imaging order is justified then (in Arnold LJ’s view) the court should  presume unless persuaded otherwise that a traditional search order is unnecessary. If the court is prepared to grant a search order,  careful consideration should be given as to the scope of that search order.

[show_profile name="Heather" surname="Rankin" jobtitle="Senior Associate, London" phone="+44 20 7466 2579]