Omni UK developed proprietary software for the hospitality industry, which Omni SA licensed and marketed in South Africa. Ms Koekemoer, as sole director and 20% shareholder of Omni SA, had fiduciary duties to the company. While employed, she, along with other employees (some of whom were family members), established a competing business, ASV, using Omni's confidential client lists, pricing information, and licensing agreements. She actively diverted Omni’s clients to ASV and later to another entity, Epicode (run by her husband and another ex-employee), passing off their products as Omni's or affiliated with Omni. After her resignation, she continued soliciting Omni's clients and misappropriating confidential information. Omni sought an interim interdict to stop the unlawful competition pending an action for damages.
An interim interdict was granted against Ms Koekemoer and Epicode, restraining them from unlawfully competing, using Omni's confidential information, soliciting Omni’s clients, and passing off their products as Omni's. Omni was directed to institute an action within 15 court days. Ms Koekemoer and Epicode were ordered to pay the costs of the main application and the postponement application.
A director and employee who uses her employer's confidential information (such as client lists and licensing agreements) to establish a competing business and divert clients, while still employed, commits unlawful competition. Such conduct justifies an interim interdict pending final relief, provided the applicant shows a prima facie right, a reasonable apprehension of irreparable harm, a favourable balance of convenience, and no other satisfactory remedy.
The court noted that Ms Koekemoer's conduct was 'morally reprehensible' and 'certainly unfair and dishonest practice that cannot be tolerated', and that allowing her to continue the illegitimate process from outside the company would serve to legitimise unlawful conduct. The court also expressed scepticism about the respondents' claim that Epicode’s product was entirely different from Omni's, given the identical licensing agreements used.
This case reinforces the protection of confidential information in the context of unlawful competition, especially where fiduciaries breach their duties by misusing trade secrets to set up competing businesses. It affirms that customer lists and licensing agreements are confidential and that an interim interdict is an appropriate remedy to prevent ongoing harm from former employees using such information to poach clients.