Crisis Management

Where a departing employee is suspected of taking information

The new employer of a former employee is approaching the company's own customers. A record has come to light of a large number of files being downloaded shortly before the employee left. A former employee who has set up a competing business is said to be approaching people who used to report to them. Situations of this kind give rise to a suspicion that information has been taken.

The fact that the new employer is approaching customers, or that employees have been approached, does not by itself establish that information was taken. Before any inquiries are made of the individual or of those around them, the company checks whether records may be lost. Where a device that was lent out is reset, where the former employee's account is deleted, and where the retention period for logs expires, the means of checking matters afterwards may be limited. In terms of order, the preservation of records and the steps to stop access and otherwise prevent further harm come before inquiries of the individual or of those around them. Alongside these steps, the company checks whether any report, notification or disclosure outside the company is required. Because suspending an account or operating a device may itself alter logs and data, the two lines of work need to be coordinated.

Beyond that, the means available differ according to how the information said to have been taken is characterized in law, the manner in which it was taken, and what was agreed with the former employee. This guide sets out those distinctions.

Last updated: September 18, 2026

What to check first

The following are matters we ask you to share with us, so far as they are known, when you contact us. You can contact us even at a stage where the facts have not been settled.

What is suspected of having been taken — the company checks the type and the scope of the information concerned, such as customer lists, quotations and cost materials, drawings and specifications, test data, source code, or personnel information. Whether personal information is included is also checked at this stage.

How that information was managed within the company at the time the information is suspected of having been taken — the company checks the settings for access rights, passwords, markings such as "confidential", where the information was kept, and whether there was a procedure for taking it out. Putting markings or written undertakings in place afterwards does not mean that the information was managed as a trade secret at the time it was taken. Because whether the information can be treated as a trade secret under the Unfair Competition Prevention Act turns to a large extent on how it was actually managed, this is a central point to check.

The grounds for suspecting that information was taken, and how the matter came to light — the company checks the facts that gave rise to the suspicion, such as access logs, records of emails sent, records of external storage media being connected, synchronization records for cloud storage, printing records, or contact from a customer.

Whether records are in a state where they will not be overwritten or deleted — the company checks the retention periods for logs, the current state of the devices and accounts lent to the former employee, and the generations of backups held. Resetting or re-issuing a device, or deleting an account, may cause records needed for checking the facts to be lost.

The documents exchanged with the former employee — the company checks whether there is an employment contract, rules of employment, a written undertaking on confidentiality or a written undertaking given on leaving, and what their terms provide. Where there is a non-competition clause, it checks the period, the geographical area, the work covered, and any provision for compensating the employee.

The circumstances of the departure, and the facts before and after it — the company checks the period between notice of resignation and the last day of attendance, the work and the authority the employee had, how the hand-over was carried out, visits to customers before and after leaving, and whether other employees have also left.

The effects arising at present — the company checks the facts it is aware of, such as terminated transactions or lost orders, inquiries from customers, sales activity by the new employer, and information that has been made public.

Whether a report, notification or disclosure outside the company may be required — where personal information is included, the company checks whether the information and the situation fall within those for which a leak or similar incident must be reported and the individuals notified. For information including individual numbers, it also checks whether a report and notification of the individuals are required under the legislation on individual numbers. For information handled under an outsourcing arrangement, and information entrusted by a business partner, the company checks the notification required under legislation and under the contract, and how responsibilities are divided.

In some sectors, a report or filing to the supervisory authority may be in issue. For a listed company, disclosure under the rules of the exchange may be in issue, and for a company that files annual securities reports, the filing of an extraordinary report may be, so these are checked together with the effect on the business.

On the basis of the records available, we consider how the investigation of the facts should proceed and in what order the former employee and the new employer should be approached.

Contents

1. Preserving records and preventing further harm
2. How the information taken is characterized in law
3. The framework changes according to how the information was taken
4. Dealing with the former employee, non-competition and poaching
5. Setting out what is sought and the procedures to use
Key legislation and official sources
Frequently asked questions

1. Preserving records and preventing further harm

The company appoints a person to coordinate the response internally and, so far as necessary, coordinates with those responsible for legal affairs, human resources and information systems. Securing the records that remain, and stopping any continuing removal or transmission of information, are taken forward in parallel, and the need for any report outside the company is checked at the same time.

Before touching devices, accounts or logs

For computers and mobile phones lent to the former employee, ordinary use, resetting and re-issue are stopped. Because remote erasure and automatic synchronization may alter the contents, while switching off a device may lose information, decisions about the state in which material is to be preserved, including how power and network connections are handled, are made with the judgment of a specialist provider where necessary. For accounts, because deletion may erase logs and stored data, the company checks whether suspension rather than deletion is possible.

The very act of a member of staff operating a device in order to check something may alter the records.

Personal accounts are treated separately, and access to preserved material is limited

Accounts managed by the company are distinguished from the former employee's own accounts. Using credentials stored on a company device to access the former employee's private email or cloud storage raises separate issues unless there is consent or another lawful basis. Where a personal device was used for work, it cannot be treated in the same way as a device lent by the company. Even for devices and accounts managed by the company, the company sets the material, the periods and the range of information to be examined by reference to the purpose of the investigation and what is needed for it, and takes care over the handling of private information and information unconnected with the investigation. The scope of what is secured for preservation is kept distinct from the scope of what is read and used, and those able to access the preserved data are limited to those who need it.

Which records remain, and for how long

Access logs, records of emails sent and received, records of external storage media being connected, synchronization records for cloud storage, records of entry to and exit from premises, and printing records each have different retention periods. Because many are overwritten after a set period, the company first checks the retention periods and preserves the records for the relevant period separately. The existence of records of downloads or of external storage media being connected is checked separately from whether information was in fact taken outside the company. Even where a device has been reset or re-issued to another employee, information and records relating to the company's email service, shared folders and backups may remain. The company records the date, time and method of any reset and how the device has been used since, and, separately from whether data on the device can be recovered, checks where information and records outside the device are held and for how long they are retained. Where the matter involves examination of devices and logs, or steps to prevent further harm to systems, see also the guide on responding to cyberattacks and information leaks.

Preserving records involves more than simply storing them: a record is also needed of when, by whom and how they were obtained. Where those records are later relied on in support of the company's case, how they were obtained may itself be in issue.

Where contact is received from a customer or another party outside the company, the company records the date and time, who made contact, and what was said, and asks that related emails and materials be retained. Where materials are to be provided by that party, the company checks the extent to which they can be provided, having regard to the confidentiality obligations that party owes. What is said in inquiries outside the company is kept to what is needed for checking the facts, and the involvement of the former employee or the new employer is not asserted as established while it remains unconfirmed.

For materials held by the former employee or the new employer that may become difficult to use in evidence later, court proceedings for the preservation of evidence may be considered. These are proceedings for the examination of evidence in advance; they are not a mechanism for searching the other side's premises broadly or for securing related materials as a whole. They are considered separately from the preservation of the company's own devices and logs.

Designing the investigation before interviews begin

Where employees still with the company are to be interviewed, the company decides first who will be interviewed, in what order, and what they will be asked. Depending on the order, accounts may be aligned between those concerned, or records may be lost.

Before interviews, the company sets out what it will explain about whether the interview is being recorded or a record made, and about the extent to which what is said will be used and shared, having regard to the purpose of the investigation and the position of the person interviewed. Asking a current employee to cooperate as part of their work is distinguished from asking a former employee to cooperate voluntarily. Even for current employees, the company sets the scope of the cooperation it asks for by reference to the connection with their duties, the need for the questions, and whether other means of checking are available. Where disciplinary action is considered on the ground that a person declined to answer, the company first checks whether there was an obligation to answer that question and the reason given for declining. Intimidating questioning, holding a person for long periods, and steering a person towards statements that do not match the facts are avoided, and care for the person's health, and whether another person may attend, are considered according to the circumstances. A promise that nothing said will be disclosed outside the company may conflict with later disciplinary proceedings, litigation or dealings with the authorities, so the explanation given is that sharing will be kept to what is necessary. How an internal investigation is conducted is dealt with in more detail in the guide on internal investigations and investigations into misconduct.

2. How the information taken is characterized in law

Even where the facts are described in the same way, as information having been taken, the basis on which a claim is put depends on how that information is characterized in law.

The three requirements for a trade secret: management as a secret, usefulness, and not being publicly known

A trade secret under the Unfair Competition Prevention Act is information that is managed as a secret, that is technical or business information useful for business activities, and that is not publicly known. In practice, the requirement most often disputed is the first.

That requirement is not settled solely by whether access to the information was limited to particular people. The approach set out by the Ministry of Economy, Trade and Industry is that the question is assessed from the perspective of whether the company's intention to manage the information as a secret was made clear to employees through specific measures, and whether employees were in a position to recognize it. What is checked, therefore, is how measures such as markings, access rights, the manner of storage, procedures for taking information out, internal rules and written undertakings were actually applied in practice.

The general knowledge and skills acquired through the work are also distinguished from the specific information that is protected. That said, information does not fall outside the protection given to trade secrets merely because it is held in a person's memory.

Where the information is not a trade secret

For information that does not meet the requirements for a trade secret, frameworks such as a contractual duty of confidentiality, provisions of the rules of employment, and tort may be available. That said, the use of information that is not a trade secret does not of itself establish a tort. Whether the manner of the conduct goes beyond the bounds of free competition, and whether a contract has been breached, are separate questions.

As to provisions on confidentiality, the company checks whether they are framed so that the obligation continues after the employment ends, how the information covered and the conduct prohibited are defined, and whether the clause can be said to be valid.

Information that is not a trade secret may also be protected as shared data with limited access where it is technical or business information accumulated in a substantial quantity and managed by electromagnetic means for the purpose of being provided to particular persons in the course of business. The company checks who the information is provided to and on what terms, and how it is accumulated and managed.

Types of information and the legal frameworks to consider

Examples of information	Frameworks to consider	The management practices to check
Customer lists, trading terms, quotations and cost materials	A trade secret. Where the requirements are not met, a contractual duty of confidentiality or provisions of the rules of employment.	Who had access, the procedure for taking information out, markings such as "confidential", and written undertakings given on leaving.
Drawings, specifications, test data, production conditions	A trade secret. Copyright or patent rights may also be in issue, in relation to the expression contained in the materials or to the working of an invention.	Where the material was kept and access rights, the terms agreed when it was provided outside the company, and internal rules on patent applications and the ownership of rights.
Source code, programs under development	A trade secret, and protection as a copyright work. For development carried out under an outsourcing arrangement, the ownership of rights under the contract.	Management of permissions for the repository, records of material being taken out, and the terms of the development outsourcing agreement.
Commercial data provided outside the company	Shared data with limited access. Information that is a trade secret is, however, dealt with under the trade secret framework. Information that is managed as a secret but does not qualify as a trade secret may meet the requirements for shared data with limited access.	Who the data is provided to and on what terms, how it is managed by electromagnetic means, and the record of provision.
Personal information of customers, employees and applicants	Handling under the Act on the Protection of Personal Information（個人情報の保護に関する法律）. Where a leak or similar incident involving personal data falls within those for which a report is required by law, whether a report to the Commission and notification of the individuals are required.	The purpose of use notified on acquisition, storage and permissions, and the security control measures in place.

A single matter often raises several frameworks at once, and it is not a question of choosing one of them.

Where infringement of rights in technical information or created works is in issue

Where the materials taken contain expression protected as a copyright work, or where their use amounts to the working of the company's patented invention, a claim based on copyright or on the patent right may also be considered. That said, holding technical information and copying it does not of itself amount to infringement of a patent right or copyright, because what a patent right covers is the working of the invention, and what copyright protects is creative expression. Where the company has itself received a warning of intellectual property infringement, see the guide on responding to a warning of intellectual property infringement.

3. The framework changes according to how the information was taken

Even where information is a trade secret, the provisions that apply differ according to how it came to be taken. This is the part of the analysis where the checking of the facts bears directly on the outcome.

Having authority to view and use information within the company is distinct from being permitted to store it on a personal device or to provide it outside the company, so the scope of each is checked separately.

Where information was acquired in excess of authority

Where a person entered an area they were not entitled to access in order to obtain information, used another person's ID, or used an account that remained active after leaving, the acquisition may be treated as acquisition by wrongful means. Access using another person's credentials may also raise a question under the Act on Prohibition of Unauthorized Computer Access（不正アクセス行為の禁止等に関する法律）. That Act is not breached as a matter of course: whether the use was through a telecommunications line, whether an access control function was in place, the method of access, and, depending on the manner of the conduct, whether the administrator of access or the authorized user consented, are each checked.

Where information shown for the purposes of the work is used or disclosed after leaving

Information that was properly shown to the employee for the purposes of the work during employment may also be treated as unfair competition where it is used or disclosed after the employee leaves. For this category, however, the Act requires the purpose of obtaining a wrongful gain or of causing damage to the holder. What is checked is whether that purpose is present and whether there was conduct amounting to use or disclosure. Disclosure here includes showing information to a particular person while keeping it secret. The mere fact that the information is at the new employer does not settle the question, but where disclosure is in issue it is not necessary to go so far as to show that the information was actually used at the new employer.

As to use, the company checks the sales activity and product development at the new employer, the timing and manner of approaches to the company's own customers, and the terms offered. As to disclosure, it checks the recipients and content of emails sent, and the settings of shared links.

Where the new employer is involved

Where the new employer acquired the information knowing, or without knowing owing to gross negligence, that a wrongful acquisition or wrongful disclosure was involved, the acquisition itself, and any subsequent use or disclosure, may be in issue. Even where the new employer did not know at the time of acquisition, the position may be the same where it came to know afterwards, or failed through gross negligence to know, and used or disclosed the information. The time of acquisition and the period after it are checked separately. Where a person acquired a trade secret through a transaction and, at that time, did not know that its disclosure was a wrongful disclosure, or that a wrongful acquisition or wrongful disclosure was involved, and was not grossly negligent in not knowing, the provisions on injunctive relief and damages do not apply to use or disclosure within the scope of the authority acquired through that transaction.

Beyond the wrongful acquisition, use or disclosure of a trade secret, the transfer or sale of goods produced through the wrongful use of a technical secret may also be in issue separately. All of these concern conduct relating to trade secrets, however, and they do not provide a means of stopping the new employer's business generally.

A warning to the new employer: check the basis and the scope of what is sought first

Where a letter of warning is to be sent to the new employer, the company separates the facts it has checked from the matters that remain unconfirmed, and sets out specifically the information and the conduct complained of and the response it seeks. Content for which the basis is insufficient, and demands going beyond the scope of the rights held, may give rise to liability even where the wording is measured. Where the letter is to be sent more widely, to the new employer's business partners for instance, or where its content is to be made public, the need for that and its content are considered separately.

Where the criminal law is in issue

Penal provisions are laid down for the infringement of trade secrets, but the range of conduct amounting to unfair competition in civil terms and the range of conduct subject to criminal penalties are not the same. As to the criminal framework, the company checks whether the conduct in question falls within the categories laid down by law, having regard to the purpose, the method, whether the conduct occurred during or after employment, and the knowledge of any person who received the information. The use of information after leaving does not of itself establish an offense. Where the conduct was carried out in relation to the business of a company, penalties applicable to the company may also be in issue.

Even where a trade secret was properly shown to the person, where that person, for the purpose of obtaining a wrongful gain or of causing damage to the holder, breaches the duties owed in managing the secret and wrongfully takes it by a method laid down by law, such as making a copy of it, the conduct before any use or disclosure may itself be subject to punishment.

One of the categories that punishes use or disclosure after leaving requires, among other things, that during employment the person offered to disclose the trade secret in breach of the duties owed in managing it, or was requested to use or disclose it. Where that is not made out, the company checks whether another category applies, covering the wrongful taking of the information or its subsequent use or disclosure.

For customer lists and similar material, the offense of improperly providing a personal information database is considered separately from whether the information is a trade secret. The company checks whether the former employee provided or misappropriated, for the purpose of obtaining a wrongful gain for themselves or a third party, a personal information database handled in connection with their work, or the whole or part of a copy or a processed version of it.

Where company property or money is involved, embezzlement in the course of business or another offense may also be in issue. Where the filing of a report of a crime with the police or of a formal criminal complaint is under consideration, the order in which to proceed needs to be set out, taking account of the progress of the internal investigation and the relationship with any civil claim.

4. Dealing with the former employee, non-competition and poaching

Separately from the taking of information, competition after the employment ends and the soliciting of employees may be in issue.

How far a post-employment non-competition clause provides a basis

Restricting the act of competing after the employment ends ordinarily requires an agreement to that effect. That said, an agreement is not automatically given effect according to its terms. In view of the freedom to choose an occupation, the validity of such a clause is decided case by case, and it is not possible to state in general terms that clauses of this kind are valid or invalid.

The factors identified as relevant to the assessment include whether there is a company interest that warrants protection, the position held by the employee concerned, the geographical scope, the duration of the restriction, the range of conduct prohibited, and whether compensation was provided. The first step is therefore to check how the company's written undertakings or the provisions of its rules of employment deal with these points.

Where the poaching of employees is in issue

The fact that a former employee has approached employees still with the company is not in itself a problem. Where preparations for, or the carrying out of, solicitation took place during employment, the obligations under the employment contract are also in issue. As to solicitation after leaving, whether it goes beyond the bounds of free competition is assessed having regard to the number of employees approached and the importance of their work, the position held by the former employee, the use of confidential information or of information about employees, whether false explanations or intimidating methods were used, the timing of the departures and the effect on the business. Where there is a clause restricting solicitation, its content and validity are checked separately. The focus is on checking the facts of who approached whom, when, and how.

Where the former employee raises claims in return

Once the company begins to deal with the former employee, claims may come back from that side concerning unpaid wages, the circumstances of the departure, or the treatment of retirement allowances. The response to the taking of information and these employment issues are distinct, although they may be dealt with in the same negotiations. That said, withholding payment of wages on the ground that information is suspected of having been taken, or the company unilaterally deducting the amount of a damages claim from wages, are to be avoided and considered separately. As to withholding, reducing or not paying a retirement allowance, the company checks the provision relied on in each case and its validity, the date for payment, and the facts said to trigger it. Where an allowance is not paid or is reduced, the seriousness of the conduct is also considered in relation to the employee's service up to that point. The employer's response to related employment issues such as wages and retirement allowances is dealt with in the guide on handling labor and employment disputes.

5. Setting out what is sought and the procedures to use

Alongside setting out what is sought, the company considers the procedures to use and the order in which to use them. The materials needed and the means that are realistic differ according to whether the aim is to stop sales activity involving the use or disclosure of the information, to seek the destruction or return of information and storage media, or to claim damages for loss suffered. Several responses may also be considered in combination. Where return is sought, a separate basis, such as ownership or a contract, may be required. Where destruction or deletion is sought first, evidence of the taking or use of the information may be lost. What is sought, and the order, are considered separately for stopping use and disclosure, for preserving records, and for return and deletion.

Stopping the use or disclosure

Where business interests are infringed, or are at risk of infringement, by unfair competition relating to a trade secret, injunctive relief may be claimed. Where the matter is urgent, an application may be considered for a provisional disposition determining a provisional status, separately from proceedings on the merits. A provisional disposition is a Japanese court procedure for interim relief pending a decision on the merits. The application requires the information concerned and the conduct to be prohibited to be identified, and requires material showing that the right to claim injunctive relief exists and that an interim measure is necessary in order to avoid substantial loss or imminent danger.

Security may be required for a provisional disposition, and prescribed procedures are needed to recover it. Where the execution of a provisional disposition is found to have been improper, because the right did not exist or for another reason, liability in damages for the loss caused to the other party may be in issue, subject to the requirements as to intention or negligence. In making the application, the company considers the scope of the injunctive relief sought and the effect on the other party's business, together with the material relied on.

There is a specific provision on the extinguishment of the right to claim injunctive relief against the use of a trade secret. For damages, the company checks the time limits that apply according to the basis of the claim, and when time starts to run. It sets out when the infringement or the loss became known, when the person responsible was identified, and when the use began.

Claiming damages

Where damages are claimed on the basis of unfair competition, the first matters to check are whether there was intention or negligence, whether business interests were infringed by the unfair competition, and whether loss was caused by that infringement. As to the amount of the loss, provisions are in place to ease the burden of proof. Where the claim is based on a contract, the content of the obligation, its breach, the grounds of attribution, and the loss and its causal connection are considered separately.

For certain technical secrets, there are provisions under which wrongful use is presumed where the circumstances of the acquisition, holding or wrongful taking of the secret, and the production or other conduct that followed, meet the requirements laid down by law. The information and the requirements covered are limited, and the provisions do not extend to business information such as customer lists. Which provision is available in a given situation is determined by the content of the information and the manner in which it was taken.

Reviewing management arrangements to prevent recurrence

According to the problems identified by the investigation, the company reviews its procedures on departure, the design of access rights, the retention periods for logs, and the content of its written undertakings, and may begin doing so while the matter is still under way. Tracing how information came to be taken often reveals operational problems, such as permissions having been left in place, or the absence of any settled treatment of the period between notice of resignation and the last day of attendance.

Our in-house training services are available as a means of communicating internal rules on the handling of information to those working on the front line, and our ongoing legal advisory services are available where internal rules and practices are to be reviewed on a continuing basis.

Key legislation and official sources

English translations of legislation are provided for reference. The Japanese texts are authoritative.

Where it appears	Legislation	Source type
The three requirements for a trade secret; the categories of unfair competition; the meaning of disclosure; shared data with limited access; goods produced through wrongful use; the exemption for acquisition through a transaction	Unfair Competition Prevention Act（不正競争防止法）	Japanese legislation
Injunctive relief; damages and the provisions easing the burden of proving the amount; the presumption of wrongful use of a technical secret; extinguishment of the right to claim injunctive relief; penal provisions and penalties applicable to companies	Unfair Competition Prevention Act（不正競争防止法）	Japanese legislation
The approach to management as a secret	Management Guidelines for Trade Secrets, Ministry of Economy, Trade and Industry（営業秘密管理指針）	Official guidance
Access using another person's credentials, access control functions, and the consent of the administrator of access or the authorized user	Act on Prohibition of Unauthorized Computer Access（不正アクセス行為の禁止等に関する法律）	Japanese legislation
Reporting of leaks and similar incidents involving personal data and notification of the individuals; situations for which a report is required and the preliminary and final reports; the offense of improperly providing a personal information database	Act on the Protection of Personal Information（個人情報の保護に関する法律）	Japanese legislation
Reporting and notification of the individuals for information including individual numbers	Act on the Use of Numbers to Identify a Specific Individual in Administrative Procedures（行政手続における特定の個人を識別するための番号の利用等に関する法律）	Japanese legislation
Filing of an extraordinary report	Financial Instruments and Exchange Act（金融商品取引法）	Japanese legislation
Protection of expression in materials and of programs	Copyright Act（著作権法）	Japanese legislation
The working of an invention, and the ownership of rights in employee inventions	Patent Act（特許法）	Japanese legislation
Tort; freedom to choose an occupation as it bears on non-competition clauses; obligations under the employment contract	Civil Code（民法）	Japanese legislation
The employment contract and the rules of employment; validity of provisions on retirement allowances	Labor Contracts Act（労働契約法）	Japanese legislation
The principle that wages are paid in full, as it bears on unilateral deduction	Labor Standards Act（労働基準法）	Japanese legislation
Embezzlement in the course of business	Penal Code（刑法）	Japanese legislation
Court proceedings for the preservation of evidence	Code of Civil Procedure（民事訴訟法）	Japanese legislation
Provisional dispositions determining a provisional status, the prima facie showing required, security and its recovery, and liability where execution is improper	Civil Provisional Remedies Act（民事保全法）	Japanese legislation
Filing a criminal complaint	Code of Criminal Procedure（刑事訴訟法）	Japanese legislation

Legal information reviewed: 2026-09-18

Frequently asked questions

We only have a suspicion and no firm evidence yet. May we still consult you?

You can contact us even where there is no firm evidence. We check how records have been retained and whether information is still being taken or transmitted outside the company. On the basis of what remains and how long it will remain, we set out how to proceed with preserving records and with the steps to prevent further harm.

May we ask the person directly?

We recommend deciding the order of the inquiries first. Once the individual knows, data on devices or in cloud storage may be deleted. Preserving the records first, and then deciding what will be asked, who will ask it and how a record will be kept, leaves more options available later.

We had not applied a "confidential" marking. Does that mean we cannot assert that the information is a trade secret?

The absence of a marking does not settle the question. Because the assessment is made from the perspective of whether the intention to manage the information as a secret was shown to employees through specific measures, the marking is considered together with other measures, such as the settings for access rights, the manner of storage, procedures for taking information out, internal rules and written undertakings. The starting point is to check which measures were actually applied in practice.

We did not obtain a written undertaking when the employee left. Does that mean we have nothing to rely on?

The absence of a written undertaking given on leaving does not by itself mean that nothing can be asserted. The company checks the bases available, including the employment contract, any written undertaking given on joining, the rules of employment, trade secrets under the Unfair Competition Prevention Act, and tort. Restricting the act of competing after the employment ends ordinarily requires a contractual basis, but whether that basis exists, and whether the clause is valid, are judged by reference not only to a written undertaking given on leaving but also to the related contracts, the rules of employment and the content of the restriction.

We would like to send a letter of warning to the new employer.

Before sending it, the basis of the company's case and the response it seeks need to be set out. Sending a strongly worded letter without a sufficient basis may leave the company facing questions about its own liability, and it also affects relationships within the industry. The company proceeds once it has decided at what stage, to whom, and for what it is asking.

The information taken includes personal data of customers or employees. What is required?

The first step is to check whether the material constitutes personal data. Information contained in a paper list, or in materials printed from a database, may also be personal data. For a leak or similar incident arising from conduct against the company that may have been carried out for a wrongful purpose, the company also checks personal information it has acquired or is about to acquire that is intended to be handled as personal data. Conduct against the company here includes conduct against a party to which the handling of personal data is outsourced, and against the provider of a service used for that handling. The company then checks whether a leak or similar incident has occurred or may have occurred.

Next, the company considers whether the situation falls within those for which a report is required by law, such as where sensitive personal information is included, where there is a risk of financial harm to the individual through the improper use of personal data, where the conduct may have been carried out for a wrongful purpose, or where more than 1,000 individuals are affected. A matter in which a former employee is suspected of having wrongfully taken information may fall within those for which a report is required even where 1,000 or fewer individuals are affected. The company also checks whether the exclusion for advanced encryption or similar measures applies, but material is not excluded merely because an ordinary password was set.

The report to the Personal Information Protection Commission and the notification of the individuals are separate obligations, so whether each is required, and when, are checked separately. The individuals here are the customers, employees and others identified by the information involved in the leak or similar incident. Depending on the business and the information concerned, the company also checks whether the report goes to the Commission or to a ministry or other body to which the authority has been delegated. The company checks when it became aware internally of a situation for which a report is required and, where a report is required, reports the matters known at that time without delay, rather than waiting for the investigation to finish or for a final internal decision. In the report, the facts that have been checked are distinguished from the matters that remain unconfirmed, and the deadlines for both the preliminary report and the final report are checked. Matters that come to light later are reported by way of supplement. Alongside this, the company takes steps to stop the information spreading further and carries out the investigation needed to establish its extent.

For data handled under an outsourcing arrangement, the company checks the position where notification is given to the outsourcing party in accordance with the law, how the report to the Commission and the notification of the individuals are divided between the parties, and the notification obligations under the contract.

Contact

Inquiries where a departing employee is suspected of taking information

Please tell us, so far as you are able, when the employee left, the type of information suspected of having been taken, how the matter came to light, and the records you have been able to check so far. You are welcome to contact us at a stage where the facts have not been settled.

Whether we are able to act, and the scope of our work, are confirmed individually after a conflict check.

This article is provided for general informational purposes only and does not constitute legal advice on any specific matter. Please consult us regarding your specific situation. The content is based on the laws and regulations in effect as of the date of the last update.