REPUBLIC OF SOUTH AFRICA
IN THE HIGH COURT OF SOUTH AFRICA
GAUTENG DIVISION, JOHANNESBURG
CASE NO: 2024-137245
DATE : 21 February 2025
In the matter between:
JOYCO (PTY) LIMITED Applicant
and
WV SQUARED (PTY) LIMITED First R espondent
KEVIN SEAN WHITTAKER Second Respondent
GARETH HARVEY Third Respondent
GAVIN HOWARD VAREJES Fourth Respondent
BLACKWAVE INVESTMENTS (PTY) LIMITED Fifth Respondent
RICHMARK HOLDINGS (PTY) LIMITED Sixth Respondent
Neutral Citation : Joyco v WV Squared and 5 Others (2024-137245 ) [2025]
ZAGPJHC --- (21 February 2025)
Coram: Adams J
Heard : 11 February 2025
Delivered: 21 February 2025 – This judgment was handed down
electronically by circulation to the par ties' representatives by
email , by being uploaded to CaseLines and by release to SAFLII.
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The date and time for hand -down is deemed to be 10:30 on
21 February 2025.
Summary: Civil procedure – urgent application – for interdictory relief against
erstwhile employees of company – unlawful competition and unlawful use of
confidential information – to constitute confidential information, such information
should: (a) involve and be capable of application in trade or industry; (b) must
be useful; (c) must not be public knowledge and public property, that is
objectively determined, it must be known only to a restricted number of people
or to a closed circle of persons; and (d) objectively determined must be of
economic value to the person seeking to protect it – applicant failed to compl y
with these requirements – no protectable interested demonstrates – application
should therefore fail – application should also fail due to lack of urgency – any
urgency self -created –
Urgent application struck from the roll for lack of urgency .
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ORDER
(1) The applicant’s urgent application be and is hereby struck from the urgent
court roll for lack of urgency.
(2) The applicant shall pay the first to sixth second respondents’ costs of this
urgent application, such costs to include the costs consequent upon the
employment of two Counsel, one being Senior Counsel, such charges to
be taxed on scale ‘ C’ of the tariff applicable in terms of the Uniform Rules
of Court.
JUDGMENT
Adams J :
[1]. The applicant ( Joyco ) is in the so called ‘ Fast Moving Consumer Goods’
(FMCG ) business and provides the mass retail market with high quality
products that are sourced by Joyco from around the world. Joyco claims to
‘bridge the gap between international suppliers and local retailers, thereby
providing consumers with access to the finest products from overseas ’. The fifth
respondent (Blackwave Investments) previously owned fifty percent of the
shareholding in Joyco. The second respondent (Mr Whittaker) was, until May
2024, in the employ of Joyco essentially as a Key Accounts Manager . The third
respondent (Mr Harvey) was also previously employed by Joyco as a Sales
Manager. Both of these individuals are closely related to the fourth respondent
(Mr Varejes), who appears to be the controlling mind behind and shareholder of
Blackwave Investments and the fifth respondent (Richmark Holdings).
[2]. Towards the end of May 2024, Blackwave and Mr Varejes exited Joyco
and terminated their involvement in the said company by selling its fifty percent
shareholding in the said company back to its previous sole owner. At the same
time Messrs Whittaker and Harvey resigned as employees of Joyco and
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immediately thereafter started trading, together with certain other individuals, as
the first respondent (WV Squared), which they had registered with CIPC on
7 February 2024. Importantly, WV Squared and Mr Whittaker started marketing,
promoting and selling a fast -moving consumer product, namely a ‘Caliburn Bar
B600’ vape , which, according to Joyco, is the exact same vape that it had
identified and wanted to sell . WV Squared also holds itself out as ‘a
distinguished entity in the fast -moving consumer goods ( FMCG) sector, serving
as both a wholesaler and distributor with a broad reach across various markets ’.
[3]. Joyco therefore alleges that the first to fourth respondents are unlawfully
competing with it in that Mr Whittaker, in breach of his fiduciary duty to Joyco, is
using its confidential information and has also stolen its business opportunity.
[4]. In this opposed urgent application Joyco applies on an urgent basis for
an order in the following terms: -
‘(1) … ... …
(2) The first respondent i s finally interdicted and restrained, whether directly or
indirectly through any other juristic entity or persona from which it will derive a
benefit, from:
(2.1) pursuing, accepting, or making use of the corporate opportunity which was
misappropriated from the applicant; namely the marketing an UWELL
Technology co. Ltd ("UWELL"), Caliburn Bar 86000 white -labelled by the first
respondent under the brand "EXSO" and
(2.2) directly or indirectly, competing unlawfully with the applicant.
(3) The second to fourth respondents are finally interdicted and restrained, whether
directly or indirectly through any other juristic entity or persona from which they
(or any of them) will derive a personal benefit, from:
(3.1) pursuing, accepting, or making use of the corporate opportunity which was
misappropriated from the applicant; namely the marketing and sale of the
UWELL, Caliburn Bar B6000 vape (whether white -labelled by the first
respondent under the brand "EXSO" or otherwise); and
(3.2) directly or indirectly, competing unlawfully with the applicant.
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(4) Alternativel y, the interdicts in paragraphs 2 and 3 above are to operate
immediately as interim interdicts pending an action to be instituted by the
applicant within 30 days of this order for final interdicts.
(5) The applicant is to institute an action for damages against the first to fourth
respondents within 30 days of this order.
(6) The first to fourth respondents are to pay the costs of this application, jointly and
severally, the one paying the other to be absolve d. Alternatively, in the event of
the fifth and/or sixth respondents opposing this application, ordering such
respondents as who oppose the application to pay the costs of this application,
jointly and severally, the one paying the other to be absolved.
(7) Further and/or alternative relief .’
[5]. In issue in this opposed urgent application is whether the applicant has
demonstrated a sustainable cause of action based on unlawful competition and
the misappropriation of confidential information. Crystalised further, the question
to be considered by me is whether the applicant has proven a protectable
interest worthy of protection by an interdict, whether that be final or interim.
Those issues are to be decided against the factual backdrop as set out briefly in
the paragraphs which follow.
[6]. As the name suggests, FMCG are products that sell quickly at relatively
low prices , such as perishables like milk and eggs, household items like
detergents and toilet paper, to sweets, chewing gum and cigarettes. Vapes also
fall in this sector. A vape is a battery -operated device that simulates smoking
and is sometimes called an electronic cigarette. Most vapes are manufactured
in China. Two manufacturers are relevant in this matter : UWELL (which makes
the Caliburn B6000 , which is then sold under brands owned by third parties)
and Vozol (which is its own brand).
[7]. Joyco has been selling Vozol vapes , at the instance of Mr Whittaker and
Mr Varejes, since 2022. Joyco got into the vape business only after
Mr Whittaker joined , and he is the one wh o brought vapes and Vozol to Joyco ,
which, during 2022, acquired exclusivity over one of the vapes, a device known
as the Vozol Bar 1200 .
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[8]. After a while, Mr Whittaker and Mr Varejes grew concerned about Joyco
becoming beholden to Vozol and they suggested that Joyco expand its vape
business to import and sell vapes under a Joyco -owned brand. They therefore
proposed that Joyco identify vapes to import and sell under a Joyco -owned
brand though a process called ‘white labelling ’. White labelling is when a retailer
or distributor sells a product using its own brand name but the product is
manufactured by a third party. This is where UWELL came in. That Chinese
company makes white label vapes , including the Caliburn B6000 , which could
be sold under different brand names .
[9]. During October 2023, Joyco sent to China a delegation, which included
Mr Whittaker, to investigate the feasibility of extending its business to ‘white
label’ vapes . Mr Whittaker and the delegation met with UWELL , and on their
return from China, Mr Whittaker proposed to Joyco that it should venture into
the purchase and sale of Caliburn B6000 vapes and resell it as ‘white label’
vapes. The respondents contend that there was nothing secret about UWELL
and the Caliburn B6000 – by mid-2023, UWELL products, incl uding the Caliburn
B6000 , were already widely available in South Africa. Mr Greenberg , the co -
owner and Chief Executive Officer of Joyco, refused to take Joyco down the
white label route and so that venture was not pursued further by the said
company.
[10]. Mr Whittaker resigned at the end of May 2024, and Mr Harvey resigned
at the end of June 2024. Neither signed a restraint, so they were free to start
new jobs competing with Joyco. The only question is whether they, in
competing with Joyco, did so unlawfully by trading as WV Squared , which then
went on to acquire and sell the Caliburn B6000 vape under its brand, EXSO.
UWELL has since discontinued the Caliburn B6000 . WV Squared has about
12 600 Caliburn B6000 vapes left in stock.
[11]. The case on behalf of Joyco is that the Caliburn B6000 venture is a
‘corporate opportunity ’ that Mr Whittaker misappropriated for WV Squared. It is
also alleged by Joyco that Mr Whittaker misused the connections he made
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whilst an employee of Joyco and its confidential information , to set up the
business of WV Squared. This, so Joyco contends, amounts to ‘springboarding’,
which is a term of art in unlawful competition. It is defined as the process by
which someone acquires and uses a s a springboard the confidential information
and trade secrets of his competitor with the aim of gaining an unfair advantage
in the market .
[12]. Mr Subel SC, who appeared on behalf of the respondents with
Mr Mitchell, argued that t here are no facts that fairly support a case based on
protecting confidential information and no facts that fairly support a case based
on preventing the growth of the EXSO brand. Neither is a case made out, so the
contention continues, in support of the case that the respondents stole a
corporate opportunity belonging to Joyco.
[13]. I find myself in agreement with these contentions on behalf of the
respondents. It is so, as submitted by the respondents, that Mr Whittaker did not
sign a restraint of trade , which means that n othing stopped him from exercising
his constitutional right to trade, including in competition with Joyco,
[14]. The first point to be made about Joyco’s ‘corporate -opportunity’ case is
that the corporate -opportunity rule does not apply after an employee resigns.
Even if an opportunity falls squarely within an employer’s line of business, a
former employee ‘is at liberty in the absence of explicit contractual restraints , to
exploit it to the full’ .1 An employee cannot, however, resign to take the
opportunity for himself, but that rule does not apply – and so the employee is
free to compete with his former employer – if the resignation was for other
reasons.2 In this case, it cannot be said with any conviction that Mr Whittaker
was prompted or influenced by a wish to acquire for himself the alleged
corporate opportunity. There is no evidence in support of such a conclusion.
1 Da Silva v CH Chemicals (Pty) Ltd 2008 (6) SA 620 (SCA) at para 21 .
2 Da Silva at para 20.
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[15]. In any event, t he Caliburn B6000 was not a corporate opportunity for
Joyco , which, on the evidence in the matter, had made a conscious decision not
to go the route of ‘ white label ’ vape s like the Caliburn B6000 . On the
respondents version, which I have to accept, Joyco, represented by its Chief
Executive Officer, disagreed with the white label proposal and Joyco never took
any concrete steps towards that business operation.
[16]. That, in my view, is the end of the applicant’s case based on the
misappropriation of a corporate opportunity. The simple point is that the
Caliburn B6000 was not a corporate opportunity for Joyco at all, or, even if it
were, Joyco was never genuinely interested in the Caliburn B6000 (or any white
label vape).
[17]. As regards the use of Joyco’s alleged confidential information , it is so, as
contended on behalf of the respondents, that an employee must keep his
employer’ s confidential information confidential for as long as he remains
employed by his employer. However, confidential information is inevitably
carried away in the employee’s head after the employment has ended and
which the employee then remains free to use for the benefit of himself or others
provided that he has not, whilst still employed by that employer, broken his duty
of good faith by, for example, making or copying a list of that customers.3
[18]. In my view, the applicant fails to prove the requirements for a cause of
action based on confidential information and springboarding. As submitted on
behalf the respondents, information about the Caliburn B6000 is not
confidential. The existence of white label vapes and those that make them,
including UWELL and the Caliburn B6000 , is not confidential. There is also no
dispute that UWELL and the Caliburn B6000 have been widely available in
South Africa for several years – even before Joyco got into the vape business .
3 Knox D’Arcy Ltd v Jamieson 1992 (3) SA 520 (W) at 527F -I. See also Waste Products Utilisation (Pty)
Ltd v Wilkes 2003 (2) SA 515 (W) at 576E -H.
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[19]. Moreover, Joyco’s business process is not confidential. Its process
amounts to finding products, importing products and selling products . That
information is ‘trivial or easily accessible’, not unique to Joyco and ‘not
confidential at all’.4 Also, as was held by this court in Combustion Technology
(Pty) Ltd v Peck5, where there is ‘ nothing unique about the way an applicant is
doing business or nothing unique about its sales methods, and its methods are
those generally adopted in a particular trade or industry, such methods cannot
be considered confidential and therefore protectable ’. This, in my view, is apt in
casu .
[20]. By the same token, the customers of Joyco are not confidential. They are
the ma jor names in the fast-moving consumer goods sector. As for the invoices
which Mr Whittaker had in his possession at the time he resigned, the applicant
could simply have asked for it to be returned to them. The fact that they did not
must lead to the conclusion that the invoices were not a genuine concern for
Joyco. They are, in any event, not confidential. The names and contact details
of large retailers like Spar and Pick n Pay are not confidential. And as for the
prices on the invoices, the invoices relate to sales that Mr Whittaker made
before he resigned from Joyco.
[21]. As was held in Alum -Phos (Pty) Ltd v Spatz and Another6, to constitute
confidential information, such information should: (a) involve and be capable of
application in trade or industry; (b) must be useful; (c) must not be public
knowledge and public property, that is objectively determined, it must be known
only to a restricted number of people or to a closed circle of persons; and
(d) objectively determined must be of economic value to the person seeking to
protect it.
[22]. As I have already indicated, n one of these requirements have been
proven by Joyco . What is more is that t he invoices alleged to be confidential by
4 Waste Products Utilisation at 576E -F.
5 Combustion Technology (Pty) Ltd v Peck 2020 JDR 1935 (GJ) at para 55.
6 Alum -Phos (Pty) Ltd v Spatz and Another [1997] 1 All SA 616 (W) at 623A –624A;
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the applicant would not be useful to a competitor and has no economic value.
They lack any degree of confidentiality and are of no use to competitors which
use the same or similar methods in their businesses.
[23]. In my view, the applicant has not demonstrated that they have
protectable proprietary interest that are being or will be infringed by the
respondents. The applicants have not presented any evidence of unlawful
competition, and there is no evidence in the papers of any injury having been
actually committed or reasonably apprehended.
[24]. For all of these reasons, the applicant ’s application should fail.
[25]. There is another reason why the applicant ’s application should fail and
that relates to the issue of urgency. The respondent s also oppose the urgent
application on the grounds that the application is not urgent. In the event that it
is determined that there is any urgency, then it is submitted on behalf of the
respondents , that the urgency is entirely self -created.
[26]. The applicant, so the respondents contend, have been aware since as
early as June 2024 that Mr Whittaker was marketing a new vape – that is five
months before Joyco launched this application at the end of November 2024.
The applicant’s founding papers leave those five months entirely unexplained.
Joyco does not explain, in detail, what happened between June 2024 and when
it launched this application during November 2024. The rhetorical question to be
asked is why the applicant took so long from June 2024 to November 2024 to
launch this application, if, in their view, the matter is so urgent.
[27]. The simple fact of the matter is that howsoever one views this matter the
applicant should have launched this application much sooner than they actually
did.
[28]. This Court has consistently refused urgent applications in cases when
the urgency relied -upon was clearly self -created. Consistency is important in
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this context as it informs the public and legal practitioners that Rules of Court
and Practice Directives can only be ignored at a litigant's peril. Legal certainty is
one of the cornerstones of a legal system based on the Rule of Law.
[29]. For all of these reasons, I am not convinced that the applicant ha s
passed the threshold prescribed in Rule 6(12)(b) and I am of the view that the
application ought to be struck from the roll for lack of urgency.
[30]. The application therefore falls to be struck from the roll and the costs
should follow the suit .
Order
[31]. In the result, I make the following order:
(3) The applicant’s urgent application be and is hereby struck from the urgent
court roll for lack of urgency.
(4) The applicant shall pay the first to sixth second respondents’ costs of this
urgent application, such costs to include the costs consequent upon the
employment of two Counsel , one being Senior Counsel, such charges to
be taxed on scale ‘ C’ of the tariff applicable in terms of the Uniform Rules
of Court.
_________________________________
L R ADAMS
Judge of the High Court
Gauteng Division, Johannesburg
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HEARD ON: 11 February 2025
JUDGMENT DATE: 21 February 2025 – Judgment handed
down electronically
FOR THE APPLICANT : A C Botha SC and C De Witt
INSTRUCTED BY: Cox Yeats Attorneys (JHB) , Sandton
FOR THE RESPONDENT S: A Subel SC and J Mitchell
INSTRUCTED BY: Stein Scop Attorneys Incorporated ,
Morningside, Sandton