The Former Client's Data
You have left a large consultancy and set up your own practice. Before leaving, you copied your contacts list, a database of 400 client contacts including names, emails, phone numbers and notes on fee sensitivity, and three template reports you had written during your employment. Your employment contract contained a confidentiality clause and an obligation to return all company property on termination; you did not return the copies. Six weeks after leaving, you are approached by a former client, who says they were unhappy with the consultancy and wants you to act on a project. You are tempted to email the 400 contacts to announce your new practice. You also want to reuse the template reports because they are efficient and, you reason, 'I wrote them'. Your old employer has not contacted you.
1. Assess the legal and ethical position on the copied contacts database and the proposed marketing email.
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The contacts database
- It is not yours. The database was compiled in the course of your employment, on the employer's systems, for the employer's business. It is the employer's confidential information and, in all likelihood, a database in which the employer holds rights.
- The contract is explicit: confidentiality plus a duty to return property on termination. You breached both by copying and retaining it. The absence of a complaint from the employer does not cure the breach; it may simply mean they do not yet know.
- Data protection: the contacts include personal data. You are now a separate controller holding data you obtained without a lawful basis for your own marketing. Using it to promote your new business is a fresh processing purpose the individuals did not expect.
- Marketing law: unsolicited electronic marketing to individuals requires consent or a valid soft opt-in, and the soft opt-in generally does not travel with you to a new business. The 400-contact email is therefore likely unlawful as well as unethical.
The templates
- 'I wrote them' is not the test. Work created in the course of employment generally belongs to the employer. Reusing them may infringe copyright and, at minimum, misuses confidential material.
- You can write new templates from scratch drawing on your general skill and knowledge - that is legitimate. Copying the files is not.
What to do
- Stop. Do not send the marketing email.
- Delete or return the copies and confirm in writing to the former employer what you held and that it has been deleted or returned.
- Build your practice on lawful routes: your own new contacts, publicly available information, and referrals. If the former client approaches you, that is different - but check your contract for non-solicitation and non-dealing clauses before accepting.
2. The former client has approached you directly. Can you act, and what checks should you make before accepting?
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Can you act?
- A direct approach by the client is materially different from soliciting them. The client has chosen to come to you. That is a strong starting point, but it is not automatically permissible.
- Check the contract. Look for non-solicitation (you cannot poach) and non-dealing/restraint clauses (you cannot act for them at all for a period). These are common and may be enforceable if reasonable in scope, duration and geography. A direct approach may fall outside a non-solicitation clause but inside a non-dealing clause.
- Check for confidential information. If you hold the former employer's confidential information relevant to this client or project, you cannot use it, and you may be conflicted. If you have already deleted the database, say so and rely only on what the client provides.
- Check for conflicts. Are you or your new firm acting for a competitor of the former employer on a related matter? Is there any live dispute between the client and the former employer in which you could be a witness?
If you can act
- Be transparent. Tell the client you previously worked for the consultancy, and confirm you will not use their confidential information.
- Ask the client to provide the project information afresh. Do not rely on your memory of the former employer's files.
- Keep a record of the approach, the checks, and the basis on which you accepted.
If the contract bars it
- Decline, explain why, and consider whether the clause is enforceable - take advice rather than guessing. Acting in breach of a valid restraint exposes you and the client to risk.
3. The former employer now writes alleging misuse of confidential information and threatening proceedings. How should you respond, and what does this episode teach about professional obligations on leaving a firm?
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Responding
- Do not ignore it and do not reply in anger. Acknowledge receipt promptly and in writing.
- Establish the facts before you respond on substance. What did you copy? What have you done with it? Have you used it? Have you contacted any of the 400? Answer these honestly to yourself first.
- Take legal advice before making admissions or denials. Confidentiality and database issues can carry serious consequences.
- Be candid and remedial. If you copied and retained material, the strongest response is prompt deletion/return, written confirmation, and an undertaking not to use it. Remedial action mitigates; concealment aggravates.
- Preserve evidence. Do not wipe devices in a way that destroys material you may be required to disclose.
- Separate the professional from the legal. Even if the legal claim is weak, your professional obligations of integrity and confidentiality are independent of whether the employer sues.
Lessons for leaving a firm
- Plan the exit before you go. Identify what is yours (general skills, knowledge, relationships you can lawfully maintain) and what is the firm's (client data, files, templates, confidential information).
- Return everything and confirm it in writing. A short email at departure listing what has been returned protects you later.
- Do not take copies 'just in case'. Convenience is not a lawful basis.
- Respect the contract you signed. Restrictive covenants and confidentiality clauses are enforceable and are read against the departing employee.
- Build the new practice on lawful foundations. Your reputation is the asset; a database you cannot lawfully use is a liability, not a head start.