Ocado wins permission to pursue Raymond McKeeve for contempt after destruction of evidence

• Ocado welcomes the decision of the Court of Appeal that allows it to proceed with committal proceedings against Raymond McKeeve, solicitor, for interference with the due administration of justice (a criminal contempt).
• Referring to the first instance judgement, the Court of Appeal concluded, “The judge's approach was, with respect, flawed and resulted in him reaching a conclusion which was plainly wrong.”
• In July 2019, McKeeve, then a partner at Jones Day, ordered the destruction of documents immediately after being made aware of a Search Order and Claim against his clients Jonathan Faiman and Today Development Partners (Today), who possessed information unlawfully obtained from Ocado.
• Ocado believes that in doing so McKeeve knowingly acted in contempt of court and did so to prevent documentary evidence being handed over in relation to Ocado v Faiman.
• Neill Abrams, General Counsel and Company Secretary at Ocado described the Court of Appeal decision as “important for Ocado and important for justice”.

Context of the case

Ocado is suing Jonathan Faiman, Jon Hillary and Today for conspiracy to misappropriate and misuse Ocado’s highly sensitive and confidential business information for the benefit of Today, a start-up rival business to Ocado.

Jon Hillary, at the time a senior employee of Ocado, admitted in his Defence of Ocado’s case that he provided confidential Ocado documents to Faiman and to Today's lawyer, Raymond McKeeve, for use by Today. Hillary admitted to breaching his employment contract and duties of confidentiality owed to Ocado.

In July 2019, Ocado obtained a Search Order from the High Court. Such an order is only given after demonstration to the court of an extremely strong prima facie case and is intended to prevent the destruction of documents and other evidence. The Order specified sanctions, including imprisonment, for failure to comply with it.

The Search Order was served on 4 July 2019 on Faiman by a supervising solicitor who was independent of Ocado.

McKeeve’s involvement

Upon being served with the Search Order, Faiman contacted his solicitor McKeeve, then a partner at Jones Day and a friend of Faiman. McKeeve spoke to both Faiman and the supervising solicitor, who explained that a Search Order had been made against Today and Faiman.

Immediately after this call, McKeeve messaged Martin Henery, the Today employee responsible for IT matters and instructed him to destroy a secure confidential messaging system known as 3CX (writing only “burn it” or "burn all"). McKeeve was so anxious to destroy the system that he also telephoned Henery to explain what he intended by “burn”.

Henery duly destroyed the 3CX system and also disabled a number of Today-related email accounts that were registered under pseudonyms, including one belonging to Mr Hillary. This came to light approximately 12 days later, when Henery disclosed the events, after which McKeeve admitted his actions.

McKeeve admitted ordering the destruction of documents after he had learned of the Search Order. He referred himself to the Solicitors Regulation Authority.

These are all uncontested facts.

Ocado applied to the High Court to have McKeeve committed for contempt in relation to the destruction. Part of McKeeve’s defence was that he wished the material to be destroyed lest it embarrass his wife, Belinda de Lucy, then a Brexit party Member of the European Parliament.

Mr Justice Marcus Smith refused Ocado’s application. Ocado appealed to the Court of Appeal.

The Court of Appeal hearing

Because the system was irretrievably destroyed, Ocado cannot know what evidence was on the 3CX application. McKeeve’s lawyer argued that the contents of the 3CX system had no relevance to Ocado’s claim against Faiman, Today and Hillary and that its existence was not evidence of conspiracy.

In response to this, during the appeal hearing in January 2021 Lord Justice Davies said: “Why else was it set up in terms of surreptitiousness, why else was it set up under pseudonyms, and why was it set up at a time when Mr. Hillary was still employed by Ocado?”

Lord Justice David Richards noted that Faiman and Hillary were not “wholly independent witnesses” in relation to the nature or relevance of the contents of the 3CX system, and Lord Justice Davies challenged the assertion that they had “no skin in the game”.

Ocado’s reaction

Commenting on the Court of Appeal decision, Neill Abrams of Ocado said:

“Raymond McKeeve intentionally and irretrievably destroyed materials that were subject to a Search Order obtained by Ocado. He is an experienced lawyer and, at the time, was a partner at a leading law firm. It is not acceptable for an officer of the Court to intentionally breach a Search Order without facing any consequences. The decision by the Court of Appeal today is important for Ocado and important for justice.

“Ocado relishes fair competition but will vigorously protect its confidential information and intellectual property which it has been developed over 20 years, and is licensed under contract to supermarkets around the world. Ocado will challenge any individual or organisation that uses information stolen from it, either directly or indirectly.”

Since this litigation, Faiman and Hillary have formed a new company called T0day, apparently continuing the same business.

Ocado's litigation against Faiman and Hillary continues and is due to be heard in the first half of next year. The committal proceedings are due to take place after the main proceedings.