Court: a confidentiality clause cannot stop you from joining a rival

A Bengaluru court has dismissed a case filed by EOX Vantage against its former employee, Shruthi BS. The company had claimed data leaks, poaching of staff and diversion of clients. It wanted a permanent injunction and more than Rs 20 lakh in losses. The court dismissed the suit with costs.

Why the company lost

• Its WhatsApp chats and emails were not backed by witness testimony.
• The forensic investigators were not named, and the records did not show data theft or poaching.
• The company never proved she joined a competitor.
• She had resigned on medical grounds in April 2022 and was given a relieving letter, which did not fit the company's later claims.

The key legal point

The court agreed that employers can protect trade secrets, pricing and client data. But under Section 27 of the Indian Contract Act, any clause that stops a person from doing a lawful job, trade or business is void.

What this means for you

• Employees: you can use your general skills and experience in a new job. Do not take company data with you.
• Employers: write confidentiality clauses to protect real business information, not as a hidden non-compete.
• Any claim of data theft needs strong, well-documented evidence.

This is general information, not legal advice.