Wednesday, November 12, 2014

Possessing *no* confidential information? Hmmmm

An interesting lawsuit between Lyft and Uber about the defection of a Lyft executive: 
According to the lawsuit, forensic computer evidence shows that in the "months and days" before leaving Lyft, VanderZanden synced his personal Dropbox account to his Lyft laptop and "systematically uploaded confidential and proprietary Lyft documents" to it. The suit also alleges that VanderZanden backed up his work emails and contacts to his personal computer and iPhone. The forensic computer report found that VanderZanden used his Lyft computer to search "how to archive in google apps" and "how to backup google apps email," and also wrote "Backup Lyft Email and Contacts" on an Evernote list of tasks to complete after he resigned. 
The complaint says that VanderZanden has repeatedly refused to sign Lyft's termination certification—which asks him to verify that he no longer possesses or will use confidential Lyft information—and that both he and Uber have repeatedly ignored requests to return proprietary Lyft information. Instead of turning over his phone for Lyft to check, VanderZanden allegedly sold the device on gadget trade-in site Gazelle shortly after he resigned. "An odd thing for a high-net worth individual to do, it was likely to cover his tracks and dispose of evidence of his misdeeds," the suit speculates. According to the filling, Uber's counsel has maintained that VanderZanden does not possess any confidential Lyft information and has not done so since leaving the company back in August. 
The "termination certification" that Lyft makes its employees sign on their way out the door is a new wrinkle.

When I left my pharma employer, I was given a copy of the NDA that I signed the first day I was there. But (if I recall correctly), I was not asked to certify anything about documents in my possession (which, I note, I had none.) If you asked me "Do you possess any confidential information that belongs to the company?", I probably would have said "No", but I can't be 100.00% positive.

Readers, have you heard of this certification popping up in the chemistry/pharma world? 


  1. This kind of language show up frequently in the NDAs together with the requirement not to transfer any information to devices or services not provided by the employer.

    Since it is possible to wipe some memories selectively now I wonder when Johnny Mnemonic addenda show up as well.

  2. I have seen something like this in termination package - it was tied as a condition of receiving severance package that was slightly above what the California labor law required. The main drift of the paperwork was though that I would not sue the company for discrimination or say anything disparaging about the company in the future or say anything about the company in the future without consulting the company lawyers or say anything about the terms of this agreement. The agreement = gag order which I proceed to ignore the day it was signed.

  3. So just as a general question, if you quit can a company actually make you sign anything that you haven't already signed? Like, they can't withhold final paychecks or anything?

  4. I worked at a high tech company. In addition to an NDA and non compete agreement I was asked if I had confidential information in my exit interview form. It was a check the box "no" type of thing. Since I quit I didn't have a severance package. If I had that option they may have been able to withhold that. I don't think they can withhold pay but can withhold anything else that they give you.

  5. After working for a company even for a day, how can anyone honestly answer "I have no company confidential information in my possession"? Even a knowledge of the vacation policy contained in the company confidential personnel manual constitutes a knowledge of confidential information. NDAs need to be carefully reviewed before signing, and my recommendation is to avoid company electronics as much as possible.

    The worst example of an NDA that I've received as a consultant was a 12-page, single spaced document that was clearly boilerplate and written by a host of attorneys. I sent it back to my contact with a note saying that they could either make it easy simple (and protects both our companies) or I can bill them 10-20 hours of technical time to rewrite it. I attached my company NDA (1.5-pages, 1.5 spaced) with a "How about this?" The client signed the simple NDA with a 20-minutes turnaround.

  6. Huh. Not only did my new employer just require a NDA and non-competition agreements, but they also insisted on a 12-month non-solicitation period. I had assumed that this was pretty normal.

    Anon 7:41 asked about the company making additional conditions upon quitting a company. After spending the last few days reviewing and discussing contractual text, I will venture the guess that the answer is "no", inasmuch as no pre-existing parts of the contract are violated.

  7. This discussion requires an ability to distinguish between know-how and confidential information. Any employee picks up know-how as he goes along; that is information about how to do his job. This belongs to and is retained by him. Confidential information is a distinct idea; this means that you can sign an NDA but apply the knowledge that you've acquired at that company in a subsequent company (see the case of Force India Formula One Team Limited v. 1 Malaysia Racing Team and others [2012] EWHC 616.) Have a look at Faccenda Chicken v Fowler to start you off... is a useful link, particularly paras 18,18.