Hindustan Unilever sues former top officials for data theft
Hindustan Unilever has asked the Bombay HC to restrain former employees Suyash Chauhan, Hemal Jain and Kishor Patil from using the data relating to manufacturing of its products
Mumbai: Hindustan Unilever Ltd (HUL) has dragged three of its former employees to the Bombay high court for allegedly stealing data related to manufacturing of its products and other confidential information.
India’s largest packaged consumer goods firm has asked the court to restrain the three former employees—Suyash Chauhan, a former managing director of Unilever Nepal Ltd; Hemal Jain, a former head of customer development at HUL’s center of excellence and Kishor Patil, a former sales and customer manager—from using the data.
On 27 March, the court allowed HUL to engage EY to carry out an audit to investigate the data theft and directed the consulting firm to submit its report to the court within two weeks. It also gave the respondents in the case three weeks to file their reply and restrained them from using or sharing the confidential data. The court will next hear the matter on 17 April.
“I find from the record that not only have defendant Nos 2 (Jain) and 3 (Patil) obtained bill of material and other confidential information, but have also disclosed and shared the same with Defendant No 1 (Chauhan) at a time when Defendant No 1 was no longer in employment with the Plaintiff and had no right or entitlement to access such information,” observed Justice S.J. Kathawala in the 27 March order. He further said that any usage of or sharing the confidential information is bound to cause irreparable injury to the company.
Typically, bills of material contain critical data such as recipes, ingredients, quantity and other materials used to manufacture products.
HUL, which was represented in the court by Raj Panchmatia, a partner at the law firm Khaitan & Co., and senior counsel Birendra Saraf, argued that the stolen information was available to only select personnel of the company on a need- to-know basis. Panchmatia declined comment.
The maker of products such as Surf Excel detergent powder and Dove soap has alleged that Chauhan and Jain have incorporated two companies—Destiny Endeavours Pvt. Ltd and D. Endeavours Fulfillment Pvt. Ltd—to serve brands through a wide and extensive wholesale and retail coverage.
On 27 March, the court also directed the respondents to disclose all the details of confidential and proprietary information they may have in their possession, either in physical or electronic form. It asked the court receiver to take possession of all confidential documents, personal laptops/external hard disks and other devices where such information could be stored.
A HUL spokesperson confirmed these developments and said that the company has sacked two of these employees for breaching policies on information security.
“During the company’s internal investigation, these employees were found to be sharing the company’s confidential information with another ex-employee, who is also a party to the suit,” the spokesperson said in an emailed statement.
An emailed query to Destiny Endeavours did not elicit any response. Senior counsel Kevic Setalvad, who is representing the defendants, said the investigation report by EY has not come and declined to discuss anything else.
On Thursday, shares of Hindustan Unilever Ltd rose 0.33%, or Rs4.65, to Rs1,413.55 on the BSE. Benchmark Sensex ended the day 0.47%, or 160.69 points, higher at 34,101.13.
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