The Australian Full Court of the Federal Court's decision in New Aim Pty Ltd v Leung [2026] FCAFC 49 is an important reminder that an employee's obligations in relation to company information may continue long after their employment has ended.
This case concerned allegations that a former executive disclosed supplier information to a competitor after resigning. In addressing those allegations, the Court clarified the scope of the equitable duty of confidence and the operation of section 183 of the Corporations Act 2001, providing important guidance on protecting commercially sensitive information.
The Background
New Aim alleged that its former Chief Commercial Officer, Mr Leung, shared the WeChat contact details of 17 suppliers with a competing business after his employment ended.
New Aim commenced proceedings, alleging that Mr Leung had:
- breached his obligations of confidence;
- breached his employment contract; and
- contravened section 183 of the Corporations Act, which prohibits the improper use of information obtained through a person's position within a company.
At first instance, the claims were dismissed. The trial judge found that the supplier information was not sufficiently confidential to warrant protection.
On appeal, however, the Full Court reached a different conclusion.
Why Was the Appeal Successful?
The Court held that the trial judge had considered the information too broadly. Rather than focusing on supplier information in general, the Court examined the specific information at issue: the contact details of 17 suppliers.
Viewed in that context, the Court found the information had commercial value and had been acquired by Mr Leung through his senior role at New Aim. It therefore attracted protection, and New Aim's breach of confidence claim should have succeeded.
The Court also found that aspects of New Aim's contractual claim had not been properly addressed at first instance, allowing that claim to proceed.
The most significant aspect of the decision
While the findings on confidentiality were important, the decision's broader significance lies in its clarification of section 183 of the Corporations Act.
A common assumption is that information must be legally confidential before a company can take action against a former employee or officer who uses or discloses it. The Full Court made clear that this is not necessarily so.
The Court confirmed that section 183 is not limited to information protected by the equitable doctrine of confidence. Instead, the key questions are:
- how the information was obtained;
- whether it was obtained through the person's position with the company; and
- whether it was improperly used to gain an advantage or cause detriment to the company.
As a result, even information that falls short of strict legal confidentiality may be protected if it is misused after being acquired through a company role.
Why this matters for businesses?
The decision confirms that the statutory protections available to companies are broader than traditional confidentiality claims.
Businesses invest significant time and resources in developing relationships with suppliers, customers and industry contacts. Although information relating to those relationships may not always amount to a trade secret, it can still have substantial commercial value.
The Full Court's decision confirms that section 183 may protect such information, even where a conventional breach of confidence claim may be difficult to establish.
Practical lessons for employers
The decision highlights the importance of proactively identifying and protecting valuable business information. Employers should:
- include clear confidentiality obligations in employment contracts;
- restrict access to commercially sensitive information where appropriate;
- implement policies governing the use and protection of supplier and customer information; and
- act promptly if there are concerns that a departing employee has taken or disclosed company information.
Final thoughts
New Aim Pty Ltd v Leung confirms that businesses are not limited to traditional confidentiality claims when seeking to protect valuable company information.
The Full Court clarified that section 183 of the Corporations Act can apply even where information is not confidential in the strict legal sense. The critical questions are whether the information was obtained through a company position and whether it was subsequently used improperly.
For employers, the decision underscores the importance of protecting commercially valuable information throughout and beyond the employment relationship. For employees and company officers, it is a timely reminder that obligations relating to company information can continue long after employment ends.
