Seizure of evidence in case of unfair competition?

In addition to the Belgian saisie-contrefacon in case of alleged infringements on intellectual property rights and the civil seizure for alleged trade secret violations, the Ghent Court of Appeal allowed in a recent decision a civil seizure of evidence in a dispute on an alleged act of unfair competition.

The case related to a dispute between a Belgian family company specialised in the design, manufacture and sale of agricultural machinery in the flax sector and a former employee and business partner (hereinafter for the sake of convenience referred to as “Company” and “Ex-partner”). The Company claimed that the Ex-partner was its right-hand man and was even regarded as a possible future successor.

When the Ex-partner suddenly ended the collaboration with the Company and started its own competing business, he took two important employees and allegedly a lot of confidential information and knowhow from the Company with him. For example, he took with him details of confidential suppliers and customers with whom the Company had built a solid business relationship for many years, he approached an employee of the company with 37 years of service to gain even more knowledge and know-how and he placed orders with suppliers of the Company using quasi-identical technical drawings and confidential article references and product specifications belonging specifically to the Company.

In view of all this, the Company filed a unilateral petition based on urgency with the president of the court of first instance to appoint a custodian to safeguard/secure evidence based on the presumption of an act of unfair competition (and thus not a trade secret or intellectual property right violation).

The President of the court of first instance of West-Vlaanderen, department Kortrijk granted this unilateral request and authorized the custodian, in practice a bailiff, to enter the registered office and production workshop of the company of the Ex-partner as well as the private residences of the Ex-partner and an employee of his company. The custodian was allowed to carry out the necessary searches there and to seize certain documents.

After this unilateral decision was overruled on third-party opposition, the issue of whether a civil seizure of evidence is possible (in general and in casu) was brought before the Ghent Court of Appeal.

In its Judgment of 30 June 2022 the Ghent Court of Appeal ruled that the search for truth has a central place in our civil procedural law and a limited form of seizure of evidence is possible, as long as the interests of the parties concerned are balanced. The question thus is whether the measures are proportionate to the objective pursued.

The Court of Appeal ruled that this was the case in casu, since a.o. (1) only the seizure of well-defined documents emanating from the Company itself, or of documents created with software licensed or owned by the Company, was intended, (2) the civil seizure of evidence was necessary because of the well-founded fear that the documents and information in question would disappear, (3) no one would have access to the seized documents and information until requested by the court who would have to deal with the case on the merits, and (4) there was no other and less intrusive possibility of securing the evidence.

Hence the Court restored the original authorization for a custodian with the exception of the right to search the private homes and car of the Ex-partner and his employee.

In our volatile, digital age evidence remains key and this decision confirms there are possibilities to secure evidence if taken in due time. Jus est vigilantibus.