Tvm Capital Healthcare Partners Limited v Ali Akbar Hashemi [2012] DIFC CFI 045 (22 May 2014)

Claim No: CFI 045/2012



In the name of His Highness Sheikh Mohammad Bin Rashid Al Maktoum, Ruler

of Dubai











Hearing: 23-25 March 2014
Counsel: Mark Beeley, Sarah Stockley and Georgina Barlow (Vinson & Elkins LLP) for the Claimant.
Nazanin Aleyaseen, Neal Brendel and Jennifer Garn (K & L Gates LLP) for the Defendant.
Judgment: 22 May 2014


Summary of Judgment

The Defendant is found to have breached a confidentiality agreement with the Claimant, and also Article 37 of the DIFC

Law of Obligations No. 5 of 2005, in many but not all of the respects alleged by the Claimant in the use of information obtained from the Claimant.

It is awarded damages of AED 250,000 on aWrotham Parkbasis, as the hypothetical price of relaxing the confidentiality restriction.

It is held that damages on this basis may be awarded under the DIFC Law of Damages

and Remedies No 7 of 2005.

This summary is not part of the Judgment and should not be cited as such

UPONhearing the Claimant and Defendant


1. The Defendant shall pay the Claimant the sum of AED 250,000 plus interest from 29 January 2012.

2. The Defendant shall pay the Claimant their costs of these proceedings except the costs of and incidental to obtaining the reports of Dr Asher and calling him as a witness.


1. The Claimant, TVM Capital MENA Limited (“TVM Capital”) (now TVM Capital Healthcare Partners Ltd), claims damages from the Defendant, Mr Ali Hashemi, for breaches of a confidentiality agreement and breaches of the duty of confidence under the DIFC Law of Obligations. For the reasons which follow, in my opinion Mr Hashemi was in breach in many but not all of the respects alleged by TVM Capital, and TVM Capital is entitled to damages of AED 250,000 and to an order for the greater part of its costs.


2. TVM Capital is part of the TVM Capital group, and is an investor in the healthcare markets in the UAE

and elsewhere. It is based in the DIFC. It holds all the shares in TVM Healthcare (CEIC) Limited (“TVM Healthcare”), which conducts an investment fund of which TVM Capital is manager. TVM Healthcare holds 39.94 per cent of the shares in PVHC Limited (“PVHC”), a Cypriot company, which in turn holds 49.9 per cent of the shares in the Abu Dhabi company, ProVita International Medical Centre LLC (“ProVita”).

3. TVM Capital exercises de facto control over PVHC and ProVita. Its Chairman and CEO is Dr Helmut Schuehsler, who is also the Chairman of ProVita.

4. In a project initiated in 2007, from early 2011 ProVita has conducted a health care facility in Abu Dhabi providing long term medical care for ventilator dependent patients and patients in need of regular medical, nursing and rehabilitatory interventions. It was the first entity to provide such services, and experienced an extended start-up period. Until early 2013 it was the sole entity licenced to provide such services within the Emirate of Abu Dhabi.

5. From March 2010 the CEO of PVHC and its subsidiaries, including ProVita, was Mr Mark McGourty. TVM Capital wished to expand the ProVita business to elsewhere in the GCC, and in 2011 it engaged Dr Peyvand Khaleghian as consultant to advise and assist in its expansion plans. Dr Khaleghian had extensive government and policy-level experience in the healthcare industry. As will appear, Mr McGourty and Dr Khaleghian became associated with Mr Hashemi in the events which form the subject of these proceedings.

6. Mr Hashemi is a United States national, resident in Dubai. His tertiary qualifications include a joint MD/MBA degree from McGill University in Canada, and he has had a number of years’ experience in healthcare investment in the United States, Europe and the Middle East. In later years he was employed by Booz & Company, part of and leading a team providing consultation services to a range of clients including investors in the healthcare industry.

7. In late 2011 Mr Hashemi decided to leave Booz & Company early the next year. He had created what he called a long-term health care platform that would develop and manage long-term care and rehabilitation facilities within the UAE. He believed this was a key growth area, and intended that his healthcare platform would acquire existing healthcare facilities and develop its own start-up operations. Speaking of late 2011, he said in his witness statement that “[i]n an effort to gauge market interest and establish this concept, I started operating, in my personal capacity, under the name ‘Avicenna Partners’”.

Interest is expressed in investing in ProVita

8. In November 2011 Dr Khaleghian spoke and then wrote to Dr Schuehsler, introducing Mr Hashemi (whom he described as “the best-connected healthcare person in the region”) as a person who had called him “to enquire about ProVita”. He said that Mr Hashemi was interested in purchasing or investing in ProVita. The introduction was at Mr Hashemi’s request: Mr Hashemi and Dr Khaleghian were acquainted through the former’s employment at Booz & Company while the latter was Director of Health Policy Strategy at the Dubai Health Authority.

9. Dr Schuehsler and Mr Hashemi met on 17 November 2011. Mr Hashemi said that he was not acting in his capacity with Booz & Company, but in his own capacity represented a wealthy UAE family which was looking to acquire an investment in the healthcare sector and had approximately USD 80 million. He expressed interest, on behalf of the UAE family, in purchasing TVM Capital’s interest in PVHC, or its interest in ProVita, or ProVita. Dr Schuehsler asked the identity of the family, but Mr Hashemi declined to disclose it.

The Confidentiality Agreement

10. In order that matters could proceed, TVM Capital and Mr Hashemi entered into a confidentiality agreement intended to provide protection to TVM Capital in relation to information provided in following through this interest. The agreement (“the confidentiality agreement”) was contained in a letter from TVM Capital dated 24 November 2011 addressed to Mr Hashemi and signed by him.

11. The first paragraph of the confidentiality agreement read –

“You, Ali Hashemi (the “Counterparty”), have expressed an interest (the “Interest”) in acquiring units in ProVita International Medical Center, a portfolio company of the Shefa MENA Health Fund (the “Fund”), a fund managed by TVM Capital MENA Limited (“TVM”). This letter sets out the terms on which we, TVM, agree to supply you with certain confidential information in connection with the Interest”.

12. The key definition in the confidentiality agreement was the definition of Information –

Information” means all information of whatever nature relating wholly or partly to TVM or the Fund or the affairs of any members of TVM’s Group (including the Fund and its Group) or relating to a third party to which TVM or the Fund is under confidentiality obligations, which:

(a) is supplied by or on behalf of any member of TVM’s Group (including the Fund and its Group) to the Counterparty or its respective Authorised Recipients whether orally, in writing or otherwise and whether before or after the date of this letter;

(b) is obtained by the Counterparty or its Authorised Recipients in writing or orally, through or following discussions with the management, employees, agents or advisers of any member of TVM’s Group;

(c) is acquired by observation or attendance by the Counterparty or its Authorised Recipients at the offices or other premises of any member of TVM’s Group (including the Fund and its Group); or

(d) consists of any reports, analyses, compilations, studies or other documents prepared by, on behalf of or for the Counterparty, and which contain, derive from or otherwise reflect any information described in (a), (b) and (c) above.”

13. This definition took up the definition of Group, relevantly meaning in relation to a party that party and its Affiliates; in turn the definition of Affiliate, meaning any person directly Controlling, Controlled by or under direct or indirect Common Control with a party; and further in turn a very wide definition of Controlling and its related terms.

14. Another definition was that of Authorised Recipients, namely –

“…to the extent that they need access to Information for the purposes of, or in connection with considering, evaluating, negotiating or advising in relation to the Interest, the Counterparty’s senior executives, officers, directors, employees, professional advisers, agents, representatives, any other members of the Counterparty’s Group and any other individuals who have received the consent of TVM to receive Information pursuant to the terms of this letter”.

15. The confidentiality agreement provided –

“In consideration of TVM agreeing to supply Information to the Counterparty, and entering into discussions with the Counterparty relating to the Interest, the Counterparty acknowledges that the Information is confidential and is received under a duty of confidentiality to TVM and the applicable member of TVM’s Group (including the Fund and its Group) and undertakes to TVM and such applicable member of TVM’s Group, including the Fund as follows:

1. Duty of confidentiality

1.1 The Counterparty shall hold the information in strict confidence and will not disclose, copy, reproduce or distribute any of it or otherwise make it available to any person other than an Authorised Recipient (on condition that they will not disclose, copy, reproduce, distribute or otherwise make it available to any other person who is not an Authorised Recipient) without TVM’s specific prior written approval (which may be withheld, delayed or conditioned in TVM’s absolute discretion).

1.2 The Counterparty and its Authorised Recipients shall use the Information solely for the purpose of evaluating the Interest and not for any other purpose.

1.3 The Counterparty will procure that each Authorised Recipient to whom Information is disclosed is made aware (in advance of disclosure) of the terms of this letter, and will use its best endeavours to procure that each such person adheres to those terms as if that person were a party to this letter. The Counterparty shall be responsible for any breach of the terms of this letter by any Authorised Recipient.

1.4 The Counterparty shall keep and shall procure that its Authorised Recipients shall keep the Information securely and properly protected against theft, damage, loss and unauthorised access (including access by electronic means). Without prejudice to the foregoing wording, the Counterparty shall notify TVM immediately upon becoming aware that any of the Information has been (or is likely to be) disclosed to, or obtained by, a third party (otherwise than as permitted by this letter) and shall take all steps as directed by TVM or as may reasonably be necessary to mitigate any adverse effect of such disclosure on TVM’s Group or the Fund.

1.5 The Counterparty acknowledges that it may be provided with Information that relates to a third party (“Third Party Confidential Information”) which has been provided to TVM and to which [sic] TVM is subject to confidentiality obligations. Accordingly, the Counterparty agrees that in addition to being bound by this letter in respect of Third Party Confidential Information it is also bound by the same confidentiality obligations that TVM is subject to pursuant to the agreement entered into between TVM and the third party providing the Third Party Confidential Information.

2. Exceptions

The undertakings in clause 1 above shall not apply to Information which:

(a) at the time of supply is in, or subsequently comes into, the public domain, except through breach of the undertakings set out in this letter or through breach of any other duty of confidentiality relating to that Information;

(b) is already in the Counterparty’s lawful possession or that of an Authorised Recipient;

(c) subsequently comes lawfully into the possession of the Counterparty (or an Authorised Recipient) from a third party who does not owe any member of the TVM Group an obligation of confidence in relation to it; or

(d) is required to be disclosed by law, regulation or any government or competent regulatory authority (including, without limitation, any securities exchange), provided that, to the extent reasonably practicable, the Counterparty shall consult in advance with (and take into account the reasonable request of) TVM on the proposed form, timing, content and purpose of the disclosure.”

16. By Clause 6.4 of the confidentiality agreement, the undertakings set out therein “shall survive for a period of thirty months from termination of this letter”. There was no express provision describing or providing for termination of the letter.

17. Clause 7.1 provided –

“7.1This letter and the relation between the Counterparty and TVM shall be governed by, and construed in accordance with, the laws of the Dubai International Finance Centre and any disputes arising in connection with this letter shall be settled before the DIFC Courts

DIFC Courts

The DIFC Law of Obligations

18. Entry into the confidentiality agreement also attracted the duty of confidence in Article 37 of DIFC Law of Obligations, No 5 of 2005 (“the Obligations Law”), which it is convenient to set out at this point. It provides –


(1) Subject to Article 37 (4), a person has a duty not to misuse specific information which he has received from another (a ‘confidant’), directly or via an intermediary, and which can reasonably be regarded as confidential, where he knows or ought to know that the information is confidential.

(2) If a person breaches his duty as defined in Article 37 (1), he is liable to the confidant.

(3) Unless non-confidentiality is otherwise expanded by agreement, information is not confidential if:

(a) it is in the public domain;

(b) it is trivial or useless; or

(c) it is in the public interest that the information should not be confidential.

(4) Misuse of information includes, but is not limited to, its disclosure.

(5) A person may disclose confidential information where -

(a) the confidant has consented, expressly or by implication, to its disclosure;

(b) its disclosure is required by law;

(c) its disclosure is required in the interests of the confidant;

(d) it is no longer confidential; or

(e) it is disclosed to a person who has a legitimate interest in receiving it.

(6) It is no defence that the defendant did not know that he was misusing the confidential information.”

Some information is provided

19. On 30 November 2011 Mr Youssef Haidar of TVM Capital provided to Mr Hashemi a PowerPoint presentation concerning the business and financial affairs of ProVita (“the ProVita Presentation”). In paper form it became a substantial document of some 34 pages.

20. It will be necessary to say more of the contents of the ProVita Presentation, but for the present it may be said that it covered –

(a) evaluation of the prospects of growth in the UAE healthcare market and into new long term medical care areas, including the prospects of repeating the ProVita business model in other countries;

(b) the investment of TVM and other investors in ProVita to date;

(c) ProVita’s financial performance and levels of utilisation for 2010 and up to October 2011, with income and cash flow forecasts through to 2014 (including for a proposed Al Ain facility);

(d) ProVita’s net margins and costs; and

(e) some details of the proposal to establish the Al Ain facility and of other expansion plans in the GCC.

21. There were brief discussions between Mr Hashemi and Mr Haidar. On
1 December 2011 Mr Hashemi emailed an extensive list of questions relating to the business, operation and financial affairs of ProVita, and said that his goal was to have a term sheet by the end of December 2011.

22. There were further exchanges of emails, but TVM Capital was reluctant to provide more information without knowing the identity of the principals for whom Mr Hashemi said he acted; the questions were not answered. For his part, Mr Hashemi continued to represent that he acted for investors (including saying that he had had a discussion with them and that they wished to see more progress). No further information was provided.

Enter Avicenna Partners

23. Mr Hashemi asked that TVM Capital agree to a six month period of exclusivity in favour of his clients, saying that without it his clients would “take their money elsewhere” and that he would be “unable to maintain their interest in the acquisition of ProVita”. He provided to TVM Capital a letter of intent and an exclusivity letter, both dated 24 January 2012.

24. The letter of intent was expressed to record the principal terms and conditions on which Avicenna Partners, or a wholly owned subsidiary of Avicenna Partners, was willing in principle “to purchase from ProVita Healthcare LLC…the whole of the issued share capital of ProVita (Abu Dhabi)”. It was signed by Mr Hashemi “For and on behalf of Avicenna Partners” and as Managing Partner, and invited signature on behalf of ProVita Healthcare LLC. The proposed purchase price was USD 83.25 million.

25. The exclusivity letter was also signed by Mr Hashemi “For and on behalf of Avicenna Partners” and as Managing Partner. It recorded, “We have been in discussions with you regarding the proposed purchase…of all the issued share capital of ProVita Healthcare LLC…”, provided for six months exclusivity of negotiations with Avicenna Partners, and invited signature on behalf of ProVita Healthcare LLC.

26. This was the first appearance between the parties of Avicenna Partners. Mr Hashemi continued to represent that he was acting on behalf of investors, and Dr Schuehsler asked who Avicenna Partners was and what relationship it had with the investors. Mr Hashemi replied that the investors had asked to remain anonymous until it was clear that TVM Capital was serious and committed to a period of exclusivity.

The discussions come to an end

27. TVM Capital could not find out anything about Avicenna Partners from its own enquiries, and Dr Schuehsler became increasingly suspicious of Mr Hashemi’s intentions. The letter of intent and the exclusivity letter were not signed.

28. There were more emails. In short, Dr Schuehsler said that TVM Capital would not move forward without knowing who the investors were, while Mr Hashemi said that the investors wanted a firm indication of TVM Capital’s intention to move forward, including the exclusivity period.

29. On 28 February 2012 Mr Hashemi emailed (over the name Avicenna Partners) that “the offer to purchase PVHC is withdrawn, with immediate effect. My investors have chosen to deploy their capital in an alternative healthcare investment”.

30. This email was sent shortly after Dr Schuehsler told Mr McGourty that his employment with PVHC and ProVita was to be terminated. For reasons which will appear, this is unlikely to have been coincidental.

The approach to Fajr Capital: the Avicenna Presentation

31. In late 2011 and early 2012 Mr Hashemi, Dr Khaleghian and Mr McGourty approached Fajr Capital LLC (“Fajr Capital”), a DIFC investment company, with a view to it investing in the healthcare industry. Fajr Capital is a government-backed fund, and could not have been the wealthy UAE family. On 22 January 2012 an agreement was signed between Fajr Capital and Avicenna Partners providing for confidentiality of information provided by Avicenna Partners to Fajr Capital. It was virtually a reproduction of the TVM Capital confidentiality agreement.

32. On or shortly after 29 January 2012 an information memorandum bearing that date was delivered to Fajr Capital (“the Avicenna Presentation”). Mr Hashemi agreed that he provided it.

33. The Avicenna Presentation was a document of 23 pages, each headed “Avicenna Partners”, and proposed investment in “a platform company that will develop and manage long-term care and rehabilitation facilities in the GCC”. The platform company was not specifically named. Mr Hashemi gave evidence that the approach to Fajr Capital was to invite an acquisition in ProVita. That is not consistent with investment in the platform company, one which would establish its own facilities, and ProVita was mentioned in the presentation, under the heading “Competitive Positioning Barriers to Entry”, as an Abu Dhabi facility approaching full occupancy. As will appear, I do not accept Mr Hashemi’s evidence.

34. The Avicenna Presentation contained much information derived from the ProVita Presentation. On TVM Capital’s case, the compilation of the Avicenna Presentation, and its provision to Fajr Capital, were each a breach of the confidentiality agreement and of the Obligations Law.

The approach to Fajr Capital: the McGourty materials

35. In circumstances not revealed in the evidence, but clearly enough acrimonious, Mr McGourty’s employment with PVHC came to an end. Pursuant to an agreement dated 5 March 2012, from that date he was “placed on gardening leave during which he will not be required to serve the Company…as an employee and need not report for work at the Company…” until termination on 29 May 2012.

36. On 1 March 2012 Mr McGourty emailed Fajr Capital, copied amongst others to Mr Hashemi and Dr Khaleghian -

“We have successfully terminated my relationship with TVM and ProVita, and the non-compete clause has been removed…

I hope we can proceed with our discussions next week so we both know if we have a ‘go or no go’ on the long term care platform”.

37. The email bore Mr McGourty’s name over “Avicenna Partners”, and described him as “Managing Partner”.

38. On 3 March 2012 a meeting was held with Fajr Capital, attended by Mr McGourty and Dr Khaleghian and by Mr Hashemi on a conference call, at which there was proposed a presentation on “the greenfield and ProVita opportunity” and “[p]rogression on agreement on commercial terms”. The meeting was arranged through Mr McGourty “after visiting with Ali and Peyvand”.

39. Responding to something in an email summarising the meeting, on 5 March 2012 Mr McGourty emailed Fajr Capital, copied amongst others to Mr Hashemi and Dr Khaleghian, and again as Managing Partner of Avicenna Partners –

“Attached is the type of reports we can provide to Fajr on a monthly basis until first patient and then move to quarterly once we achieve cash flow positive target. Let me know what you think and if you require additional reports.

We are working on the additional points raised in your email.”

40. The attachment was the ProVita management report for 2011, giving extensive financial information, information on patient and staff numbers, and other information.

41. On 14 March 2012 Fajr Capital asked Mr McGourty for “information on ProVita”, being pre-operating costs and capex and monthly costs, revenue and KPIs since inception. In a return email the next day, sent amongst others to Mr Hashemi and Dr Khaleghian and again sent as Managing Partner of Avicenna Partners, Mr McGourty said –

“Attached is some of the information you requested. I may need to get the additional information from my old finance team, but that will take a few days. Let me know if the attached information is sufficient”.

42. The attachment was a copy of the PowerPoint presentation for a ProVita board meeting dated March 2012. It gave extensive financial information for 2011 and January 2012.

43. As well as the documents provided as described in the preceding paragraphs, there were provided by Avicenna Partners to Fajr Capital at some time before the end of February 2012 –

(a) a document entitled “Strategic Regulatory Due Diligence, Proposed $US 5 million investment in ProVita Abu Dhabi by NBK Capital Mezzanine Fund 1” dated 23 March 2011;

(b) An AED 1, 727, 595 Credit Facility Agreement dated 25 August 2010 between ProVita Health Care Services LLC and Gulf Finance Corporation;

(c) a Standard Provider Contract dated 19 January 2011 between National Health Insurance Company – Daman PJSC and ProVita International Medical Center LLC; and

(d) the ProVita standard form Resident Admission Agreement.

44. The evidence of this was by a hearsay statement of Mr Zahid Kamal, in the form of an affidavit although not sworn as such. Mr Kamal was a qualified lawyer and the head of Legal and Corporate Affairs for Fajr Capital. Mr Hashemi did not ask that he be called for cross examination, and no submission was made to gainsay the evidence that his employer did not wish him to be called to give evidence. In my opinion the hearsay evidence should be given weight, and I accept that these documents were provided.

45. However, I cannot be satisfied that the documents were provided by Mr Hashemi himself. Mr McGourty was the provider of the other documents apart from the Avicenna Presentation, and I consider that on the balance of probabilities the documents (a) to (d) above were also provided by Mr McGourty. He had the direct dealings in responding to Fajr Capital’s requests for information and otherwise providing documents to them, from the terms of the email of 1 March 2012 including prior to that date. Nor am I prepared to infer that documents (a) to (d) were provided by Mr McGourty to Mr Hashemi, as TVM Capital submitted, or even that he was told at the time that Mr McGourty had provided them to Fajr Capital. The evidence on this was too silent.

46. In circumstances not elaborated in the evidence, “for commercial reasons” Fajr Capital did not take Avicenna Partner’s approach any further.

47. On TVM Capital’s case, the provision of all these documents (“the McGourty materials”) constituted breaches of the confidentiality agreement and the Obligations Law. It said that if Mr Hashemi did not himself provide them, the provision was a provision on his behalf, and a use by him, through Mr McGourty as a member of Avicenna Partners. Alternatively, TVM Capital said that Mr Hashemi was in breach of Clause 1.4 of the confidentiality agreement when, knowing of provision by Mr McGourty of the attachments sent on 5 and 15 March 2012, he did not notify TVM Capital.

The Approach to Al Zarooni Investments

48. Al Zarooni Emirates Investment LLC (“Al Zarooni Investments”) manages parts of the investments of the Al Zarooni family. Through a wholly owned subsidiary it holds shares in PVHC, one of the shareholders of ProVita. Its CEO is Mr Adil Al Zarooni. By virtue of its shareholding, Mr Al Zarooni is a permanent invitee to board meetings of PVHC as an observer.

49. Through family members, Mr Al Zarooni was told of a possible investment opportunity in the long-term health care sector in Abu Dhabi. On 28 May 2012 he was introduced to Mr Hashemi and Dr Khaleghian, who said they represented a company called Avicenna and were launching a project involving long-term healthcare in that Emirate. The vehicles were to be Amana Holdings Ltd (“Amana”) and as the operating company Amana Residences Medical and Rehabilitation Hospital LLC (“Amana Residences”).

50. Mr Al Zarooni was shown an information memorandum and was taken through it; he saw considerable similarity to the business model of ProVita. He asked about other investors and who would run the operating company, and received vague replies. After signature of a non-disclosure agreement at Mr Hashemi’s request (again, it was very similar to the confidentiality agreement), on 7 June 2012 a copy of the information memorandum (“the Amana Presentation”) was provided by Mr Hashemi to Mr Al Zarooni. There were two editions of the Amana Presentation in evidence, one dated 31 May 2012 and the other (stated to be a draft) dated 4 June 2012. It was not suggested that they were materially different, and presumably the later in date was provided.

51. The Amana Presentation was a document of 42 pages, more elaborate than the Avicenna Presentation but a clear lineal descendant. The pages bore headings “Avicenna Partners”, and the document proposed investment in Amana and through it the operating company as operator of two long term medical care facilities in Abu Dhabi and Al Ain. Mr Hashemi and Dr Khaleghian were the “founders” of the Amana companies. Avicenna Partners Limited was to provide an initial capital investment. Again, it contained information derived from the ProVita Presentation.

52. On further consideration, Mr Al Zarooni noted similarities to information he had received at PVHC board meetings and possible use of ProVita financial information. He had a number of concerns, including as to the involvement of Mr McGourty. Mr Hashemi said that Mr McGourty was advising, and when pressed that he would be CEO of Amana; also that Dr Khaleghian could step in as CEO if required.

53. There were some further discussions and exchanges of emails, but Mr Al Zarooni’s concerns were such that he took the matter no further.

54. On TVM Capital’s case, the compilation of the Amana Presentation and its provision to Al Zarooni Investments were each a breach of the confidentiality agreement and of the Obligations Law.

The Approach to Al Waha Capital

55. Al Waha Capital Co (“Al Waha Capital”) is an investment company based in Abu Dhabi. Its CEO is Mr Wissam Darwish. TVM Capital relied on hearsay evidence of Mr Darwish, in the form of a police statement made in September 2012. There was not a satisfactory explanation for failure to call Mr Darwish, but Mr Hashemi did not ask that he be called for cross-examination and nothing was said against the reliability of his evidence. His evidence is consistent with other evidence of approaches to potential investors, and I accept it.

56. In late June 2012 Mr Darwish was told of an investment opportunity in the medical and healthcare field. On 25 June 2012 he received an email from Dr Khaleghian asking for a meeting, according to the police statement the email saying that Dr Khaleghian and Mr Hashemi were partners in “Afsina”: I take this to be a phonetic misrendering of Avicenna. A nondisclosure agreement was signed with “Afsina”, and a meeting took place on 3 July 2012.

57. The meeting was attended by Mr Hashemi and Dr Khaleghian. Mr Darwish was invited to invest in a medical centre to be established in Abu Dhabi specialising in treating those with special needs. He was told that there was a feasibility study, and on the next day (the police statement says 4 June, clearly an error for 4 July) the feasibility study was emailed by Mr Hashemi to Mr Darwish. This was the Amana Presentation.

58. The evidence revealed only that Mr Darwish ultimately decided that he was not interested in investing.

59. On TVM Capital’s case, the provision of the Amana Presentation was a breach of the confidentiality agreement and of the Obligations Law.

Some more on Avicenna Partners and Amana

60. As I have related, Mr Hashemi said that in late 2011 he started operating in his personal capacity under the name “Avicenna Partners”. In the earlier part of 2012 he was holding himself out as Managing Partner of Avicenna Partners, and in March 2012 Mr McGourty was also (to Mr Hashemi’s knowledge) holding himself out as Managing Partner of Avicenna Partners.

61. At this time no company named Avicenna Partners existed. Avicenna Partners Ltd was incorporated in the Cayman Islands on 17 May 2012, with Mr Hashemi and Dr Khaleghian as equal shareholders. Amana Holdings Ltd was also incorporated on 17 May 2012 in the Cayman Islands. It was, or became, wholly owned by Avicenna Partners Ltd.

About the Witnesses

62. I defer until later any reference to the expert evidence.

63. Evidence was given in TVM Capital’s case by Dr Schuehsler and Mr Al Zarooni, together with the hearsay evidence of Mr Kamal and Mr Darwish. Dr Schuehsler and Mr Al Zarooni were both cross examined. It was evident that Dr Schuehsler felt quite keenly that TVM Capital and ProVita had been wronged by Mr Hashemi, but he gave his evidence carefully and I do not think its accuracy or reliability was thereby compromised. Mr Al Zarooni was also careful and precise in his evidence. I have no hesitation in accepting them as truthful and reliable witnesses.

64. Evidence was given in Mr Hashemi’s case by Mr Hashemi and by Dr El Daw Abdalla Suliman, the latter in relation to the public availability of information concerning healthcare facilities in the UAE. Mr Hashemi was cross examined. Dr Suliman was not, and there is no reason to decline to accept his evidence.

65. Mr Hashemi’s oral evidence was marked by loquacity, often unresponsive answers, and an evident concern to promote his own case in the proceedings. Time and again he thrust his own would-be favourable explanation upon the cross examiner. Appreciating the dangers in an impression formed from observing a witness, nonetheless I did not have confidence in his concern for accuracy or truthfulness.

66. In this regard, I am satisfied that Mr Hashemi’s representations to Dr Schuehsler that he was acting on behalf of a wealthy UAE family were false. (Mr Hashemi denied that he so represented, although he said that he said he was acting for a number of investors whom he declined to identify; I accept Dr Schuehsler’s evidence). Mr Hashemi’s purported interest in ProVita was in aid of his own creation of a long-term healthcare platform, to be established through Avicenna Partners. He was seeking investment for Avicenna Partners’ platform company from Fajr Capital at the very time he was purporting to act for investors, whom he declined to identify but who he said required an exclusivity period and wanted to remain anonymous. Mr Hashemi is no stranger to mendacity.

67. Of particular note in Mr Hashemi’s evidence was his attempt to explain Mr McGourty’s provision of materials to Fajr Capital as Mr McGourty acting in his capacity as CEO of ProVita: an absurd proposition (and one not assisted by evidence from Mr McGourty) when Mr McGourty was on gardening leave and purported to act as Managing Partner of Avicenna Partners. I would not be prepared to accept the evidence of Mr Hashemi where it conflicted with other evidence, or unless it was inherently credible, against his interests or not contentious.

68. Neither Dr Khaleghian nor Mr McGourty was called to give evidence. Dr Khaleghian was in court from time to time during the hearing. No explanation for the failure to call them was given. They are in Mr Hashemi’s camp, and their absence does not assist his case.

69. My factual findings have been and will be made in accordance with these views of the witnesses.

Behind the interest in investing in ProVita

70. Breaches of the confidentiality agreement or the Obligations Law can occur or not occur regardless of Mr Hashemi’s purpose, but it is relevant to find what his purpose was in his dealings with TVM Capital. His case includes that he did not receive Information protected by the confidentiality agreement because the information he received was in the public domain. Some light is shed on its nature by his course of conduct, and if he sought to acquire confidential information in order to use it in implementing his own healthcare platform one would not readily find that he failed in his purpose. Further, Mr Hashemi’s purpose is material to whether there was use of Information in contravention of Clause 1.2 of the confidentiality agreement.

71. Mr Hashemi’s approach to TVM Capital was not a genuine interest in investing in ProVita. The representations that he was acting on behalf of a wealthy UAE family were false, and in January – February 2012 he was seeking investment from Fajr Capital using an information memorandum, the Avicenna Presentation, in which the proposed platform company was a competitor to ProVita. In due course the proposal became more specifically, in the Amana Presentation, one of establishing medical care facilities distinct from, and necessarily competitive with, ProVita’s business. The development from the Avicenna Presentation to the Amana Presentation is obvious, but it is clear that all was in furtherance of Mr Hashemi’s implementation of his long-term health care platform, in which Dr Khaleghian and Mr McGourty were deeply involved.

72. Mr Hashemi’s purpose, in my opinion, was to obtain from TVM Capital information which he would use to assist in implementing his own healthcare platform, on the evidence including seeking investors in the platform company. Having received the ProVita Presentation, he unsuccessfully sought more information through the list of questions. He kept the approach to TVM Capital alive throughout January and February 2012, when he was separately approaching Fajr Capital, and perhaps – it is not necessary to decide – the proposed exclusivity agreement was intended to lessen competition with his own venture by keeping others away from ProVita and its Al Ain expansion.

73. Mr Hashemi had the collaboration of Mr McGourty and Dr Khaleghian. As to the former, this was plainly before he was placed on gardening leave (since he told Fajr Capital that “we” had terminated his relationship with TVM Capital and ProVita and that he hoped to “proceed with” the discussions). As to the latter, it began while the consultancy agreement was still on foot: Dr Schuehsler said that Dr Khaleghian was “let go” in the first half of March 2012.

74. Mr McGourty told Fajr Capital that “the non-compete clause” had been removed. In fact, under the termination agreement he remained subject to a non-competition obligation until November 2012 and under confidentiality obligations for even longer: his actions as related in these reasons appear to have been in breach of those obligations, and it is not easy to see how he could have misunderstood his position. When Mr McGourty was told that his employment was to be terminated, Mr Hashemi brought the discussions with TVM Capital to an end. Despite Mr Hashemi’s denial, this is likely to have been because it was thought that TVM Capital would not volunteer more information and Mr McGourty could now take a more prominent role.

75. Dr Khaleghian’s involvement also appears to have been in breach of his obligations, a matter to which I will return.

Breach of the confidentiality agreement in relation to the ProVita Presentation

76. TVM Capital submitted that –

(a) there was breach of Clause 1.2 of the confidentiality agreement when Mr Hashemi used the ProVita Presentation or information in it not for the purpose of evaluating interest in investing in ProVita, but in developing investment memoranda (the Avicenna Presentation and the Amana Presentation) for promoting his own healthcare venture;

(b) there was breach of Clause 1.2 of the confidentiality agreement when Mr Hashemi used the ProVita Presentation or information in it not for the purpose of evaluating interest in investment in ProVita, but by providing the investment memoranda to Fajr Capital, Al Zarooni Investments and Al Waha Capital in seeking investment in his own healthcare venture;

(c) there was breach of Clause 1.1 of the confidentiality agreement when Mr Hashemi disclosed information in the ProVita Presentation by providing the investment memoranda to Fajr Capital, Al Zarooni Investments and Al Waha Capital in seeking investment in his own healthcare venture.

77. On the structure of the confidentiality agreement, the first question is whether something is Information within the definition in the confidentiality agreement. If it is, it is subject to the undertakings in Clause 1 unless those undertakings do not apply because the Information falls within one of the paragraphs of Clause 2.

78. The ProVita Presentation was clearly Information. It was supplied by TVM Capital, and was in its entirety information relating to the affairs of ProVita as a member of TVM Capital’s Group, and in part of TVM Capital or PVHC themselves also members of the Group. It was also a compilation or other document prepared for Mr Hashemi containing, derived from or reflecting information described in previous paragraphs of the definition.

79. On the findings I have made, this Information was used contrary to Clause 1.2 of the confidentiality agreement in both respects for which TVM Capital contended, see (i) and (ii) above. In amplification, each of the Avicenna Presentation and the Amana Presentation contained statements, diagrams and financial projections and a business plan plainly taken from or based on information in the ProVita Presentation, sometimes verbatim and sometimes with alterations which do not detract from their origin. These were not just matters of expression, but included matters of importance.

80. The misuse is unsurprising. Mr Hashemi had set out to obtain, and had obtained, information of assistance to his promotion of his own healthcare platform. It was in a form adaptable to an information memorandum for attracting investment, and it is not unexpected that the material was used in recognisable derivations from the ProVita Presentation.

81. On the findings I have made and this amplification, the parts of the Avicenna Presentation and the Amana Presentation so derived were not held in confidence, and were disclosed, contrary to Clause 1.1 of the confidentiality agreement; as TVM Capital contended, see (iii) above. To repeat, the disclosure is not surprising: Mr Hashemi had material readily useable for promotion of his own healthcare platform, and used it.

82. Mr Hashemi made essentially two submissions in opposition to these conclusions, both invoking Clause 2 of the confidentiality agreement. One was that Clause 2 (c) applied because Dr Khaleghian had assisted in the preparation of the information memoranda. The other was that Clause 2 (a) applied because all the Information was in or had come into the public domain otherwise than through breach of Clause 1 or any other duty of confidentiality.

83. The reliance on Clause 2 (c) cannot be accepted.

84. First, it depends on evidence from Mr Hashemi about Dr Khaleghian’s involvement in preparation of the information memoranda. There was some scant evidence that Mr Hashemi prepared the information memoranda with “inputs” from or “the collaboration of” Dr Khaleghian, and that Dr Khaleghian wrote again for Mr Hashemi what he had written for the ProVita Presentation. I do not accept, so far as Mr Hashemi gave evidence to this effect, that Dr Khaleghian rather than the ProVita Presentation was a source of the relevant content of the information memoranda and thereby it “subsequently…came into the possession of” Mr Hashemi. Apart from the view I have expressed on Mr Hashemi’s credibility and the fact that Dr Khaleghian was not called to give evidence, common sense tells that the work would not be done all over again. Usable material was used.

85. Secondly, even if Dr Khaleghian was the independent source of the relevant content of the information memoranda, he owed to a member of the TVM Group an obligation of confidence in relation to it. He may have owed a duty of confidence under Article 37 of the Obligations Law, but it is sufficient to refer to his contractual obligations.

86. Dr Khaleghian was engaged by TVM Capital to provide consultancy services under an agreement which required that he use any materials prepared by him for TVM Capital only in connection therewith and that he protect their confidentiality. The agreement was terminable on 90 days’ notice, and provisions “which are by their nature intended to survive the…termination…will survive such…termination”. The evidence showed only that Dr Khaleghian was “let go” in early March 2012. Probably that was the giving of 90 days’ notice, so that the agreement remained on foot until early June 2012; in any event, the obligation of confidentiality was one which survived termination. Dr Khaleghian’s conduct would have been in breach of this obligation of confidence.

87. Dr Khaleghian was also engaged by ProVita Holding Company LLC as “Senior Advisor with TVM working with ProVita in our Dubai and Abu Dhabi office”. The entity ProVita Holding Company LLC (“ProVita Holdings”) is not otherwise explained; I infer that it is a member of the TVM Group. (The engagement letter is signed by Mr McGourty as CEO). The engagement letter provided that he should not “at any time whether during or after [his] employment disclose, publish or make any use whatsoever” of any information or knowledge becoming known to him in the course of his employment regarding the business or affairs of the company. Reading the confidentiality obligation down to use otherwise than for the purposes of his employment, Dr Khaleghian would have been in breach of this obligation of confidence also.

88. I do not overlook Mr Hashemi’s submission that Dr Khaleghian “was cleared of all wrongdoing in the Abu Dhabi courts in respect of his involvement in” the Avicenna Presentation and the Amana Presentation. This may overstate what the Abu Dhabi courts decided, but so far the submission appealed to principles of res judicata (as it appears was intended) it misapprehends them; see later in these reasons. I have come to my conclusion on the evidence before me, which plainly differs from that before the Abu Dhabi courts.

89. Nor can the reliance on Clause 2 (a) be fully accepted, although it should be accepted in part.

90. Mr Hashemi detailed sources in publicly available materials from which the information found in the ProVita Presentation and the two information memoranda could be taken. (The submissions on his behalf initially included that the relevant information in the information memoranda had in fact been taken from the sources: that was not the evidence, and would defy common sense. I understand that part of the submissions to have been abandoned). The evidence of Dr Suliman was, more generally, about public availability of information on critical care bed capacity and occupancy rates in intensive care units and public hospitals and the need for further capacity in the UAE.

91. As earlier suggested, some light is shed on the nature of the information in the ProVita Presentation by Mr Hashemi’s purpose in his dealings with TVM Capital. An obvious reason for obtaining from ProVita information such as its financial performance and its evaluation of growth prospects was that the information was not publicly available at all; or as to other information, that although material could be ferreted out and compiled and analysed, that work had been done and the product was not publicly available. There was more than the convenience of not having to go to sources.

92. A further consideration is that Mr Hashemi obtained from each of Fajr Capital, Al Zarooni Investments and Al Waha Capital non-disclosure agreements matching the confidentiality agreement prior to providing the Avicenna Presentation or the Amana Presentation. This was not imposing a condition in compliance with Clause 1.1 of the confidentiality agreement, since none of the approaches to those entities was in relation to the Interest and the approaches to Al Zarooni Investments and Al Waha Capital were well after Mr Hashemi had brought the discussions with TVM Capital to an end. Mr Hashemi’s case that all the information he received was in the public domain is belied by his own steps to protect it as confidential information.

93. Clause 2 (a) is not attracted to the breaches of Clause 1.2 of the confidentiality agreement, because they are constituted by misuse of the ProVita Presentation and its contents as a compilation of other documents, itself Information. TVM Capital accepted that parts of the ProVita Presentation were derived from public sources, but said, correctly, that it added its own information and analysis and the end product constituted Information. As Dr Schuehsler explained -

“… such data points that are public have been added to TVM’s own information, carefully analysed by TVM, and certain information has been selected, compiled and assembled into various tables representing TVM’s own conclusions which have been drawn from the data points. This exercise has been done at the expense of TVM and its affiliates, and using the expertise of TVM and its affiliates. The end product of this process is the ProVita Presentation…”.

94. Mr Hashemi as recipient of the ProVita Presentation was spared the time, trouble and expense of himself going to the sources so far as they did provide information in the public domain; the ProVita Presentation as a compilation or other document was not in the public domain.

95. Clause 2 (a) has potential application to the breaches of Clause 1.1 of the confidentiality agreement. When the ProVita Presentation was not itself passed on to Fajr Capital or the other hoped – for investors, the disclosure must be of identifiable non-public information within it. Much of the information in the ProVita Presentation was not available from the publicly available materials. It included historical and budgeted financial information and an outline of the proposed Al Ain facility and steps to establish it. If that information was disclosed by reproduction in the information memoranda, not necessary verbatim but in substance, there would be breach. But not all the information was of that kind.

96. TVM Capital identified pages in the ProVita Presentation on which it relied as non-public information. While it would have informed Mr Hashemi’s development of his own venture, most of that information is not reproduced in the information memoranda in sufficiently identifiable manner. The exception is a table of GCC growth prospects, the figures in the ProVita Presentation for Qatar, Saudi Arabia, Kuwait, Oman and Bahrain bring reproduced with the addition of figures for the UAE. The raw materials were in the public domain, but collation and analysis was necessary to arrive at the figures. The explanation of the analysis in the ProVita Presentation is reproduced almost word for word as the explanation for what is said to be “Avicenna analysis”.

97. Mr Hashemi’s evidence that Dr Khaleghian wrote again what he had written for the ProVita Presentation appears to have been directed to this. In my view, the information was lifted from the ProVita Presentation. To this extent, there was disclosure contrary to Clause 1.1 of the confidentiality letter of information not in the public domain.

Breach of Article 37 of the Obligations Law in relation to the ProVita Presentation

98. This can be dealt with quite briefly in the light of what I have already said.

99. Information within the definition in the confidentiality agreement was to Mr Hashemi’s knowledge reasonably to be regarded as confidential information – that was the point of the confidentiality agreement. Article 37 (3) (a) was the only exception to confidentiality on which Mr Hashemi relied, and he did not rely on any part of Article 37 (5). It follows from what I have already said that Mr Hashemi misused the confidential information, by using the ProVita Presentation in a manner foreign to the occasion for receiving it and by disclosing the GCC growth prospects figures to third parties in the promotion of his own venture. Mr Hashemi breached his statutory duty.

Breach of the confidentiality agreement in relation to the McGourty materials

100. TVM Capital primarily submitted that Clauses 1.1 and 1.2 of the confidentiality agreement were breached by the provision of the McGourty materials on Mr Hashemi’s behalf and their use by Mr Hashemi, in ways similar to each of the ways (i) to (iii) described in relation to the ProVita Presentation. As a subsidiary submission, it said that Mr Hashemi breached Clause 1.4 of the confidentiality agreement when, knowing that Mr McGourty had provided the attachments sent on 5 and 15 March 2012 (“the March email materials”), to Fajr Capital, he did not notify TVM Capital.

101. Mr Hashemi submitted that he had not disclosed or used the McGourty materials “but was merely copied on emails when the documents were disclosed by Mr McGourty”; that Mr McGourty’s dealings with Fajr Capital were not to do with Amana (sic), but to do with potential investment in ProVita; and that the McGourty materials were not Information within the definition in the confidentiality agreement.

102. It is convenient to begin with the last two submissions.

103. As I have described, the Avicenna Presentation was directed to investment in a platform company competing with ProVita. It was provided at the end of January 2012, and neither then nor later when the McGourty materials were provided was investment by Fajr Capital in ProVita the objective of the dealings with Fajr Capital. Late in 2012 Fajr Capital was considering investment in ProVita, but I reject that in March 2012 Mr McGourty was acting as CEO of ProVita – a proposition I have described as absurd – or as Managing Partner of Avicenna Partners was acting towards anything other than the Avicenna Partners venture. Apart from the Avicenna Presentation, Mr McGourty wanted to know if there was a go or no go on the “long term care platform”, not on investment in ProVita; and he proffered the type of reports “we can provide to Fajr on a monthly basis until first patient and then move to quarterly once we achieve cash flow positive target”, not the type of reports ProVita could provide on its existing operations.

104. The submission that the McGourty materials were not Information within the definition in the confidentiality agreement was brief. It was said that the offer to purchase PVHC had been withdrawn on 28 February 2012, and any information obtained thereafter could not be Information because Mr Hashemi was no longer interested in it. (As put, this submission would not apply to documents (a) to (d) the subject of Mr Kamal’s evidence).

105. Treating the interest in ProVita to which the confidentiality agreement refers as a legitimate interest, there is some support for this in the reference to the terms on which TVM Capital agreed to supply information “in connection with the Interest”. But any connection with the Interest is not merely temporal; for example, information supplied by an officer of TVM Capital on 1 March 2012 in ignorance that the offer to purchase PVHC had been withdrawn would surely be caught. Although not so put, there is a larger issue, and one which applies to all the McGourty materials.

106. The McGourty materials would not be Information simply because they were confidential to TVM Capital or ProVita. In considering breach of the confidentiality agreement, the definition of Information must be satisfied. Neither party’s submissions fully addressed whether the definition was satisfied.

107. The McGourty materials were not supplied by or on behalf of a member of TVM’s Group, within paragraph (a) of the definition. Mr McGourty was acting outside his employment and contrary to the duties owed to his employer. Nor were they acquired by Mr Hashemi by observation or attendance within paragraph (c) of the definition. The materials copied to Mr Hashemi could, however, be obtained by him through Mr McGourty as employee of PVHC, a member of TVM’s Group.

108. Apparently with this in mind, TVM Capital submitted that it should be found on the probabilities that Mr McGourty had given the McGourty materials to Mr Hashemi prior to and in March 2012. As I have said, I do not think there is a sufficient basis so to find as to the materials other than the March email materials. As to the March email materials, Mr Hashemi may have submitted that they were not noted as attachments in the emails although the submission was probably limited to the email of 1 March 2012. The two later emails said they were attached, the email of 5 March 2012 was sent to Mr Hashemi rather than just being copied, and even the copies would not have omitted the attachments. It is to be expected that Mr McGourty would have fully informed all those to whom the email went.

109. Mr McGourty remained an employee although on gardening leave, and there is no reason to read paragraph (b) of the definition down to apply only to an employee authorised to give information: there is reason to read it so as to apply to information illicitly obtained from an employee.

110. In my opinion the March email materials were within the definition, and there was sufficient connection with the Interest in any information obtained after 28 February 2012 through the continuation of Mr Hashemi’s conduct in receiving information concerning ProVita. The rest of the McGourty materials, however, have not been shown to have been “obtained” by Mr Hashemi within paragraph (b), the terms of which preclude an obtaining simply because (as I later describe) Mr McGourty was acting on Mr Hashemi’s behalf in providing them to Fajr Capital.

111. Returning to the submission that Mr Hashemi had not disclosed or used the McGourty materials, TVM Capital submitted in particular that Mr Hashemi, Dr Khaleghian and Mr McGourty were acting in partnership whereby Mr McGourty’s acts were acts of Mr Hashemi. It said that the partnership was evidenced by their meetings together, and together with Fajr Capital, and by the uses of the name Avicenna Partners and the title Managing Partner and the copying of emailed materials. It submitted that they were carrying on business with a view to making profit within DIFC General Partnership Law, No 11 of 2004 (“the Partnership Law”), and that Articles 23 (1) (agency) and 25 (acts binding the partners) of the Partnership Law applied.

112. Mr Hashemi took issue with the existence of a partnership, and said that the Partnership Law did not apply because the parties were not domiciled in the DIFC. (He also said that Mr McGourty “has been cleared of any wrongdoing by the courts of Abu Dhabi”: as with the like submission in relation to Dr Khaleghian, this was misconceived).

113. I do not think it necessary to go into the application of the Partnership Law, or the cases ofKeith Spicer LtdvMansell(1970) 1 All ER 462 andSofigen SAvWebster(1983) 1 WL 880545 to which TVM Capital referred: they are concerned with whether persons working together to form a company are carrying on business together with a view to profit. Agency can be found on the facts, without the need to find a partnership.

114. On his own evidence, Avicenna Partners was the name under which Mr Hashemi began operating. He acquired Dr Khaleghian and Mr McGourty as collaborators, and the three of them dealt with Fajr Capital. All participated in the meeting on 3 March 2012, Mr Hashemi on a conference call. Mr Hashemi knew of Mr McGourty’s use of the title Managing Partner of Avicenna Partners in his dealings with Fajr Capital, and clearly acquiesced in it. From the beginning of March 2012 Mr McGourty took a more prominent role, purportedly having become free of the non-compete clause.

115. In my opinion the inference is readily available, and I infer, that Mr Hashemi deputed Mr McGourty to be the principal interface with Fajr Capital particularly once he was (said to be) free to do so, and to respond to its requests and otherwise provide information to it, on behalf of Avicenna Partners: and Avicenna Partners was at least Mr Hashemi, if not all three of them in collaboration. In providing the McGourty materials, Mr McGourty acted on behalf of Mr Hashemi.

116. Subject to one matter, therefore, there was breach of Clauses 1.1 and 1.2 of the confidentiality agreement by the provision and use of the March email materials in the dealings with Fajr Capital, unless they were in the public domain. Of their nature, they were not.

117. The further matter is that on the view I have earlier expressed the March email materials were obtained by Mr Hashemi, as Information, at the same time as their immediate provision and use in the dealings with Fajr Capital: both occurred with the email from Mr McGourty. Was there contravening provision and use?

118. In my opinion, there was. In using Mr McGourty as his agent, Mr Hashemi must have contemplated that information McGourty held would be disclosed to Fajr Capital and that he, Mr Hashemi, would be informed of the information and its disclosure. To give proper scope to the protection afforded by the confidentiality agreement, the instantaneous events should be treated as occurring first, the obtaining of the material and secondly, its provision and use. But if this be incorrect, there was use by Mr Hashemi after the immediate provision and use when he permitted the dealings with Fajr Capital to continue, albeit not to a successful conclusion, with the benefit of the provision of the material.

119. For completeness, I should deal briefly with breach of Clause 1.4 of the confidentiality agreement. If the McGourty materials were Information, Mr Hashemi knew of the disclosure of the March email materials but it has not been shown that he knew of the disclosure of the other McGourty materials. He failed to notify TVM Capital, and there was breach to that extent. However, any damages for the breach would be assessed on a different basis from the damages for the other breaches I have found, including consideration of what TVM Capital would have done had it been notified and how that would have affected the promotion and establishment of Mr Hashemi’s long term care platform. None of this was explored, and I will say no more of breach of Clause 1.4.

Breach of Article 37 of the Obligations Law in relation to the McGourty materials

120. Again, this can be dealt with quite briefly in the light of what I have already said.

121. It is not necessary that the McGourty materials fell within the definition of Information. It is sufficient that they were reasonably to be regarded as confidential and Mr Hashemi knew or ought to have known that they were confidential. As to all but the Standard Provider Contract and the Resident Admission Agreement, which presumably would be have been provided to an interested person on request, in my opinion they were, and he did or ought to have. If I am incorrect in my view that the McGourty materials were Information, nonetheless Article 37 (1) applies to all the McGourty materials except the two standard forms.

122. The duty thereby resting on Mr Hashemi was breached by misuse in the provision of the material on his behalf by Mr McGourty. It does not matter that Mr Hashemi knew of the provision only at the same time (Article 37 (6)). If that be incorrect, there was breach by misuse in permitting the dealings with Fajr Capital to continue with the benefit of the provision of the materials.

Summary of breaches

123. In summary, in my opinion there were breaches –

(a) of Clause 1.2 of the confidentiality agreement, in the use of the ProVita Presentation and the March email materials part of the McGourty materials;

(b) of Clause 1.1 of the confidentiality agreement, in the disclosure of the table of GCC growth prospects part of the ProVita Presentation; and

(c) of Article 37 of the Obligations Law in the misuse of the ProVita Presentation and of the McGourty materials other than the two standard forms.

124. The breaches of Article 37 have a slightly wider scope than the breaches of the confidentiality agreement. In particular, if I am incorrect in finding breach of Clause 1.1 of the confidentiality agreement in relation to the March email materials, the breach of Article 37 extends to those materials.

A general defence

125. Mr Hashemi raised a general defence to the claims against him, initially on the basis ofres judicataand as developed on the basis of abuse of process.

126. ProVita initiated criminal proceedings in Abu Dhabi against Mr Hashemi, Dr Khaleghian, Mr McGourty and another former employee, alleging conspiracy to disclose or otherwise use confidential information of ProVita. The criminal proceedings were continued by the prosecuting authorities, but a claim to compensation accompanied them: it was described as a claim to AED 21,000 “as recompense” and as a claim to damage “resulting from the crime”. The Abu Dhabi Bani Yas Court

of First Instance dismissed all claims, and an appeal to the Court of Appeal was dismissed. ProVita took the compensation claim to the Court of Cassation, without success.

127. Other proceedings were brought against Mr McGourty in the courts of Cyprus. No detail of these proceedings is revealed in the evidence. Arbitration proceedings were brought in the Dubai International Arbitration Centre against Mr McGourty and Dr Khaleghian under the terms of their employment or consultancy agreements. Again, no detail of these proceedings is revealed in the evidence.

128. Mr Hashemi’s reliance on res judicata was misplaced: there have been no other civil proceedings between TVM Capital and Mr Hashemi, in relation to misuse of confidential information or at all.

129. What has sometimes been called the extended principal ofres judicata, stemming fromHendersonvHenderson(1843) 2 Hare 100, has been recast inJohnsonvGore Wood(2002) 2 AC 1 to a question of abuse of process. It is asked whether in all the circumstances a party’s conduct is an abuse of process: it was there held that there was not an abuse of process when a company’s proceedings against solicitors were followed by proceedings against those solicitors brought by a director and majority shareholder in the company. The burden of establishing abuse of process rests upon the party alleging it.

130. I do not think that abuse of process has been established in the present case.

131. Mr Hashemi submitted that TVM Capital sought to relitigate the issues decided against it in the Abu Dhabi criminal proceedings, and by doing so further to waste his limited resources, discredit him and his partners and Amana via public court proceedings, and prevent or hinder his fund-raising and licensing efforts on behalf of Amana. He referred also to a letter from Dr Schuehsler to the Abu Dhabi Health Services Company in July 2012 notifying it of the Abu Dhabi criminal proceedings and the arbitration proceedings (although there was a follow-up letter, undated, notifying it of the result of the criminal proceedings as regards Dr Khaleghian and of settlement of “certain civil actions” against Dr Khaleghian “with no admission of liability on either side”). He submitted that the present case “has little to do with the protection of so-called confidential information and is nothing more than an abusive process and part of [TVM Capital’s] broader course of conduct to unlawfully limit competition and maintain its market share in the area of long-term medical care”.

132. These were serious allegations, which should have been put, but were not put, to Dr Schuehsler. Dr Schuehsler was not cross examined at all to the effect that TVM Capital, or he, caused any of the proceedings to be brought for the asserted improper purposes. It would be difficult to accept the submission when that basis had not been put to Dr Schuehsler so that he could respond. Nor did Mr Hashemi give evidence to support the suggested ill effects of the proceedings.

133. In any event, I do not accept the submission. Those with responsibility for ProVita’s business had grounds to consider that there had been wrong conduct on the part of Mr Hashemi, Mr McGourty and Dr Khaleghian, and were entitled to take steps to seek redress. There is no occasion to find that they engaged in litigation other than in exercising that entitlement, and I do not think the letter to the Health Services Company casts the litigation in a different light.

134. Abuse of process could be found short of use of the present case for improper purposes. The criminal and other proceedings earlier described do not make it out.

135. The inclusion of the compensation claim in the Abu Dhabi criminal proceedings turned upon proof of the criminal liability, and the court required “certainty”; and it seems to have been an adjunct not under ProVita’s control. It is not easy to see how a civil claim for breach of contract (the confidentiality agreement) or of the Obligations Law could have been included in those proceedings. The reasons of the Bani Yas Court of First Instance were in evidence. With respect, the holding that the information in question (it is not entirely clear what it was) was not confidential information is a little difficult to understand, and appears to have been significantly influenced by the view that because the defendants prepared the materials and the materials were reviewed by the board of directors, they were not secret. The reasons of the Court of Appeal essentially affirmed those of the trial court, and the reasons of the Court of Cassation are not in evidence. Almost nothing is known of the proceedings in Cyprus, nor of the arbitration proceedings which are likely to have been required by the employment and consultancy agreements and so had to be brought separately.

136. In my opinion, there was and is ample proper occasion to bring the present case, and it has not been shown to be an abuse of process for TVM Capital to have brought and to prosecute it.

Damages: The Primary Claim: Entitlement to damages

137. TVM had an alternative claim to damages reflecting lost revenue, but its primary claim was to damages arrived at on the basis found inWrotham Park Estate Co LtdvParkside Homes Ltd(1974) 1 WLR 798 (“Wrotham Park”).

138. InWrotham Parkthe defendant built houses in breach of a restrictive covenant benefiting the plaintiff estate. The housing development did not affect the value of the estate, but damages were awarded assessed at five per cent of the profit made by the defendant from the breach of covenant. This was said to represent the sum the plaintiff might reasonably have demanded to release the covenant. In awarding damages on this basis the judge (Brightman J) drew upon cases of trespass to land, the “wayleave” cases, and cases of wrongful detention of goods, where no financial loss may have been caused but damages are awarded.

139. The same approach has since been taken where the right infringed has been contractual rather than proprietary. Damages representing the sum which the plaintiff might reasonably have demanded as the price for relaxing a contractual restriction have been awarded, for example, for exploiting musical works in breach of a settlement agreement (Experience Hendrix LLCvPPX Enterprises Inc[2003] EWCA Civ 323; (2003) 1 All ER (Comm) 830 (“Experience Hendrix” – recordings of Jimi Hendrix), and for using information in breach of a confidentiality undertaking (Pell Frischmann Engineering LtdvBow Valley Iran Ltd[2009] UK PC 045; (2011) 1 WLR 2370) andForce India Formula One Team Limitedv1 Malaysia Racing Team SDN BHD[2012] EWHC (Ch) 616 (“Force India”)). There is no reason why, if otherwise available and appropriate, they should not be awarded as the price of relaxing a statutory restriction such as that in Article 37 of the Obligations Law (see Article 37 (5) (a), consent by the confidant to disclosure).

140. InForce IndiaArnold J preferred the description of “negotiating damages”, which I will adopt. He gave a summary which I do not understand Mr Hashemi to have disputed (although he disputed that negotiating damages could be awarded in the present case) –

“i) The overriding principle is that the damages are compensatory: see Attorney-General v Blake at 298 (Lord Hobhouse of Woodborough, dissenting but not on this point), Hendrix v PPX at 26 (Mance LJ, as he then was) and WWF v World Wrestling at 56 (Chadwick LJ).

ii) The primary basis for the assessment is to consider what sum would have been arrived at in negotiations between the parties, had each been making reasonable use of their respective bargaining positions, bearing in mind the information available to the parties and the commercial context at the time that notional negotiation should have taken place. See PPX v Hendrix at 45; WWF v World Wrestling at 55; Lunn v Liverpool at 25 and Pell v Bow at 48-49, 51 (Lord Walker of Gestingthorpe).

iii) The fact that one or both parties would not in practice have agreed to make a deal is irrelevant; see Pell v Bow at 49.

iv) As a general rule, the assessment is to be made as at the date of the breach: see Lunn Poly at 29 and Pell v Bow at 50.

v) Where there has been nothing like an actual negotiation between the parties, it is reasonable for the court to look at the eventual outcome and to consider whether or not that is a useful guide to what the parties would have thought at the time of their hypothetical bargain: see Pell v Bow at 51.

vi) The court can take into account other relevant factors, and in particular delay on the part of the Claimant in asserting its rights: see Pell v Bow at 54”.

141. Mr Hashemi submitted that negotiating damages could not be awarded in the present case because they were not permitted by the DIFC Law of Damages and Remedies (DIFC Law No 7 of 2005: “the Damages Law”). It was common ground that the Damages Law was a code such that, if negotiating damages were not within it, TVM Capital was not entitled to damages on that basis.

142. By Clause 7.1 of the confidentiality agreement, it and the relationship between TVM Capital and Mr Hashemi were governed by the laws of the DIFC. Part 2 of the Damages Law applies to any contract to which the DIFC Contract Law 2004 (DIFC Law No 6 of 2004) applies (Article 7), and the Contract Law applies “in the jurisdiction of the Dubai International Finance Centre” (Article 3). Given the conclusions to which I have come, it is sufficient that I assume that the Damages Law applies to the confidentiality agreement.

143. Part 2 of the Damages Law is concerned with damages under the law

the Law
of contract. Within that Part, Articles 8-11 provide –

“8 Right to Damages

Any non-performance gives the aggrieved party a right to damages either exclusively or in conjunction with any other remedies except where the non-performance is excused under the Law of Contract.

9 Full Compensation

The aggrieved party is entitled to full compensation for loss sustained as a result of the non-performance. Such loss includes both any loss which it suffered and any gain of which it was deprived, taking into account any gain to the aggrieved party resulting from its avoidance of cost or loss.

10 Measure of Damages

Subject to the limitations stated in this Part 2 of the Law, the injured party has a right to damages as measured by:

(a) the loss in the value to him of the other party’s performance caused by its failure or deficiency, plus

(b) any other loss, including incidental or consequential loss, caused by the breach, less

(c) any cost or other loss that the injured party has avoided by not having to perform.

11 Certainty of Harm

(1) Compensation is due only for loss, including future loss, that is established with a reasonable degree of certainty.

(2) Compensation may be due for the loss of an opportunity in proportion to the probability of its occurrence.

(3) Where the amount of damages cannot be established with a sufficient degree of certainty, the assessment is at the discretion of the Court”.

144. The Obligations Law provides in Article 10 –

“10 (1)To establish liability under this Law, a claimant must show that, but for the defendant’s conduct, he would not have suffered loss, and that the defendant’s conduct was a substantial cause of his loss.

(2) Once a claimant has shown that the defendant’s conduct caused his loss, within the meaning of this Article, and assuming that all other requirements for the defendant to be liable are made out, the defendant is liable for the claimant’s entire loss, subject to Chapter 1 of Part 3 and the Law on Damages and Remedies.”

145. Chapter 1 of Part 3 of the Obligations Law is concerned with apportionment, and is not relevant. Part 3 of the Damages Law is concerned with damages in the Law of Obligations. Within that Part, Articles 23 – 27 provide:

“23 Right to Damages

The breach of an obligation under the Law of Obligations gives the injured party a right to damages to compensate the injured party for the losses, pecuniary and non pecuniary, sustained as a result of the breach. The right to damages can either be exclusive or in conjunction with other remedies.

24 Full Compensation

The injured party is entitled to full compensation for loss sustained as a result of the breach of the Law of Obligations.

25 Measure of Damages

The injured party has a right to damages as measured by that sum of money which would put him in the same position as he would have been in if he had not sustained the wrong for which he is to be compensated, plus in each case, any other loss caused by the breach of the Law of Obligations.

26 Special Cases

(1) In the case of personal injury, the injured party has the right to damages for non pecuniary loss as measured by that sum of money as is fair and reasonable to compensate the injured party for the loss sustained.

(2) In the case of trespass to land, the injured party has a right to damages, in addition to an amount determined under Article 25, measured by an amount equal to what a person would reasonably have had to pay for his use of the land, if the possession of the land had allowed it, and the value of anything he removes from the land.

27 Certainty of Loss

(1) Compensation is due only for loss, including future loss, that is established with a reasonable degree of certainty.

(2) Compensation may be due for the loss of an opportunity in proportion to the probability of its occurrence.

(3) Where the amount of damages cannot be established with a sufficient degree of certainty, the assessment is at the discretion of the Court”.

146. Article 35 (1) of the Damages Law provides in part –

“35 (1)Where a person commits a breach of any requirement, duty or obligation which is imposed under any DIFC Law the Court may, on application of any person who is aggrieved by such conduct or has suffered loss or damage arising from such conduct, make one or more of the following:

(a) an order for damages;

(b) an order for compensation;


(g) any other order that the Court thinks fit.”

147. Article 38 gives power to grant injunctions or order specific performance, and Article 40 (1) provides –

“40 (1)Where the Court has jurisdiction to entertain an application for an injunction or specific performance it may award damages in addition to, or in substitution for, an injunction or specific performance”.

148. Mr Hashemi’s submissions were not developed with close attention to the terms of the Damages Law. They began to the effect that there was no liability for breach of Article 37 of the Obligations Law unless TVM Capital had suffered loss substantially caused by the breach, and that TVM Capital had not suffered any “direct loss” as a result of the breaches. They were then to the effect that damages could only be given for loss sustained as a result of breach and that negotiating damages were not given for loss so sustained. TVM Capital’s submissions responded but briefly.

149. The submissions call for consideration of the nature of negotiating damages, but essentially turn on statutory interpretation: what can be “loss” suffered or sustained as a result of or caused by breach of contract or of an obligation under the Obligations Law?

150. Although not always so regarded (see for exampleSurrey County CouncilvBredero Homes Limited(1993) 3 All ER 705 per Steyn LJ at 714;Attorney-GeneralvBlake(2001) 1 AC 268 at 281 per Lord Nicholls), that negotiating damages are compensatory has become established. In the words of Millett LJ inJaggardvSawyer(1995) 2 All ER 189; (1995) 1 WLR 269 at 1369, inWrotham ParkBrightman J “sought to measure the damages by reference to what the plaintiff had lost, not by reference to what the defendant had gained”. The comprehensive analysis of the cases by Chadwick LJ, with whom Kay and Wilson LJJ agreed, inWWF–World Wide Fund for NaturevWorld Wrestling Federation Entertainment Inc[2007] EWCA Civ 286; (2008) 1 WLR 455 (“WWF”) includes citation of a passage from the speech of Lord Hobhouse inAttorney-GeneralvBlakeat 298, speaking of a case such asWrotham Park

“What has happened in such cases is that there has either actually or in effect been a compulsory purchase of the plaintiff’s right of refusal…What the plaintiff has lost is the sum which he could have exacted from the defendant as the price of his consent to the development. This is an example of compensatory damages. They are damages for breach. They do not involve any concept of restitution and so to describe them is an error. The error comes about because of the assumption that the only loss which the plaintiff can have suffered is a reduction in the value of the dominant tenement.”

151. Debate over legal taxonomy has not been stilled, but on the present authorities it must be accepted that negotiating damages compensate for a loss. For what loss do they compensate?

152. That is informed by the observation of Lord Nicholls, with whom the members of the House other than Lord Hobhouse agreed, in Attorney General

Attorney General
vBlakeat 285 that –

“…the law recognises that damages are not always a sufficient remedy for breach of contract. This is the foundation of the court’s jurisdiction to grant the remedies of specific performance and injunction. Even when awarding damages, the law does not adhere slavishly to the concept of compensation for financially measurable loss. When the circumstances require, damages are measured by reference to the benefit obtained by the wrongdoer. This applies to interference with property rights. Recently, the like approach has been adopted to breach of contract”.

153. So inWWFChadwick LJ said at [59] –

“When the court makes an award of damages on theWrotham Parkbasis it does so because it is satisfied that it is a just response to circumstances in which the compensation which is the claimant’s due cannot be measured (or cannot be measured solely) by reference to identifiable financial loss. Lord Nicholl’s analysis inAttorney GeneralvBlakedemonstrates that there are exceptional cases in which the just response to circumstances in which the compensation which is the claimant’s due cannot be measured by identifiable financial loss is an order which deprives the wrongdoer of all the fruits of his wrong.”

154. In other areas of the law there can be compensable loss other than financial loss. It is sufficient to refer to damages for pain and suffering in a personal injury claim, and in a claim for breach of contract there can be damages for loss of enjoyment of a holiday (JarvisvSwans Tours(1973) QB 233) or other breach of a contract whose object was to give pleasure, relaxation or peace of mind (FarleyvSkinner[2001] UKHL 49: (2001) 3 WLR 899). The trespass, “wayleave” and detention cases compensate for loss other than direct financial loss. InWrotham Parkthe compensable loss lay in infringement of the estate’s proprietary right. Much earlier, inWatson,Laidlaw & Co LtdvPott,Cassels and Williamson(1914) 31 RPC 104 at 119, speaking of patent infringement, Lord Shaw referred to “abstraction or invasion of property” before giving his example of wrongful use of a horse which is returned without loss, saying that wherever there is abstraction or invasion of property the law ought to give a recompense of price or hire. In the Antipodes that was taken up by Allsop P inBunnings Group LtdvChep Australia Ltd[2011] NSWCA 342 at [175], in connection with an illuminating explanation of the detention cases –

“The damage or loss caused to the plaintiff with rights of ownership and possession who is in the business of hiring goods of the kind converted or detained is not limited to the consequences of stock depletion or to the cost of replacement, but includes the denial and infringements of its rights. Those rights have been denied to the plaintiff by the commission of a tort involving the use of the goods by a tortfeasor. It is entirely logical and in accordance with justice and commonsense that a wrongdoer should pay a price for using the goods of another as a matter of compensation for the denial of the right concerned”.

155. Confidential information may strictly not be property, but where there has been use of confidential information in breach of a confidentiality undertaking there has been an abstraction or invasion of the aggrieved party’s contractual rights and, as expressed by Lord Hobhouse, in effect a compulsory purchase of the use of the information.

156. So inExperience Hendrixat [45] Mance LJ referred to the “commercial value of the right infringed”, and inForce Indiaat [384] Arnold J adopted fromAttorney GeneralvBlakean analogy with damages “when a defendant has invaded another’s property rights but without diminishing the value of the property”. Seeing the loss in the abstraction or invasion of property is in my view preferable to seeing it, more directly, as a loss of the sum the plaintiff could have exacted from the defendant (the words of Lord Hobhouse inAttorney-GeneralvBlake, above). If negotiating damages can be awarded although the plaintiff would not have agreed to make a deal concerning the proprietary or contractual right, the loss cannot be of the price for making a deal. It would be odd if there was compensable loss only where the plaintiff would have agreed to make a deal; the wrong is just as great, if not greater, where it would not, and that is not the law.

157. In my view, it is the same with the right given by the statutory protection of confidential information under Article 37 of the Obligations Law (a close analogy can be seen with statutory protection of patented material: patent infringement is abstraction or invasion of a statutory monopoly right, and the damages may be a reasonable royalty for the infringing acts). In each case there is a loss, for which compensatory damages maybe awarded even though the aggrieved party does not prove financial loss such as diminished revenue.

158. Does this come within the Damages Law?

159. The governing direction is that the aggrieved party is entitled as damages to “full compensation for loss sustained” as a result of breach of contract or breach of the Obligations Law (Articles 9, 24), and any other remedy as well (Articles 8, 23). The Damages Law in general reflects common law principles. While differences may be found from its terms, which must be adhered to, it should not be construed narrowly so as to detract from fullness of compensation, or from compensation for the kinds of loss which would attract compensation on common law principles.

160. The terms of the Damages Law do not suggest departure from compensation for the kinds of loss which would attract compensation on common law principles. Although sometimes “loss” may be used in a pecuniary sense (e.g. Articles 13, 25), non- pecuniary loss is recognised (Articles 23, 26 (1)), as is loss of a chance (Articles 11 (2), 27 (2)). The special cases of personal injury and trespass to land the subject of Article 26 are not special because they must be declared to be kinds of loss for which compensation maybe given – that they are kinds of loss falling within Article 23 is assumed, and special measures of the damages are directed. This is of some significance, since it includes acceptance of a kind of loss for which negotiating damages may be given.

161. It may be that in the case of breach of the Obligations Law the short answer to Mr Hashemi’s submission is that TVM Capital is aggrieved by his conduct in breach of that Law and is entitled to an order for compensation, pursuant to Article 35 (1): the label of damages can be dropped. Possibly an answer lies in damages in substitution for an injunction, pursuant to Article 40 (1), although negotiating damages are now not seen as damages in lieu of an injunction (seeWWFat [54]). Neither of these were suggested in submissions, and I mention them not as encouragement but to exclude them from consideration.

162. In my view the wider answer, applicable both to breach of the confidentiality agreement and to breach of Article 37 of the Obligations Law, is that the losses constituted by the abstraction or invasion of TVM Capital’s contractual and statutory rights are losses suffered or sustained within Article 10 of the Obligations Law and Articles 9 and 23 of the Damages Law. They are suffered or sustained as a result of or caused by the breaches; the breaches are the denials of the contractual and statutory rights. Negotiating damages can be awarded, in the case of breach of the confidentiality agreement as a measure of the loss in value to TVM Capital of Mr Hashemi’s performance (Article 10 (a)) or another loss (Article 10 (b)) and in the case of breach of Article 37 of the Obligations Law as a means of restoring its position or another loss (Article 25).

163. Mr Hashemi made two other submissions in opposition to entitlement to negotiating damages.

164. The first was that negotiating damages could only be awarded when TVM Capital had not suffered compensable financial loss; but, he said, it had, as evidenced by its alternative damages claim. He said also that in the Abu Dhabi criminal proceedings ProVita had asserted a loss of AED 21,000; it is not clear how that loss was made up.

165. Mr Hashemi relied for the submission on the reference by Arnold J, inForce Indiaat [383], to negotiating damages where the claimant “cannot prove orthodox financial loss”. This took too much from his Lordship’s words. Sometimes there may be no financial loss (as inWrotham Park). Sometimes financial loss maybe expected but not be reasonably calculable with any degree of certainty. Sometimes the financial loss may be an inadequate reflection of a real loss. In the common law, and nothing in the Damages Law is to the contrary, the court assesses damages so as best to achieve adequate compensation; see the observations of Chadwick LJ inWWFearlier set out concerning the just response to circumstances in which compensation cannot be measured by reference to identifiable financial loss. In the present case I consider that TVM Capital should not be confined to a difficult, if at all possible, task of demonstrating actual financial loss, and that negotiating damages are an appropriate way of giving due compensation to it.

166. Mr Hashemi’s second submission was that any confidential information was information of ProVita, not TVM Capital, so that TVM Capital had no claim to damages. There was a companion submission, to which I will come, in relation to use of ProVita’s assets and revenues in the assessment of negotiating damages; the two submissions were not clearly distinguished.

167. The submission is misconceived. Mr Hashemi entered into the confidentiality agreement with TVM Capital, and received information from TVM Capital as confidant within Article 37 of the Obligations Law. The negotiating damages represent the price for which TVM Capital might have released or relaxed the confidentiality undertakings or consented to disclosure of the confidential information. TVM Capital is a proper claimant to damages.

Damages: The Primary Claim: Quantum

168. TVM Capital’s assessment of negotiating damages was presented through the expert evidence of Dr James Asher. He provided a report dated 12 February 2014 (replacing an earlier report), and two supplementary reports dated 27 February 2014 and 3 March 2014 responding to questions from Mr Hashemi’s lawyers. Dr Asher was cross examined. Mr Hashemi did not call any expert evidence going to quantum.

169. Dr Asher was a physicist by background, but from at least 2003 had provided services for the commercial management of intellectual property. He had extensive experience in the valuation of intellectual property. His reports demonstrated careful consideration and analysis, and in cross examination he was responsive and objective. For reasons which will appear I do not feel able to take up his conclusions, but I do not doubt his general expertise or his attention to providing assistance to the Court.

170. The primary task undertaken by Dr Asher was to value the interest of TVM Capital in certain intangible assets (including intellectual property) of ProVita, as he understood it from his instructions being assets “accessed” through Mr Hashemi by Amana and its affiliates. I intend no disservice to the detail of his reports in summarising his valuation process as follows.

171. First, Dr Asher identified all intangible assets he thought material to ProVita’s business. These were process-based assets (quality management documents and operating systems; licensing and accreditation; knowledge of specialist equipment required to deliver the services; and the process knowledge of the management team and staff) and reputation-based assets (the ProVita brand; marketing materials; domain name and website; knowledge of the sales process and key personal relationships formed by ProVita; and knowledge of the contracts and the order book). He considered that these types of intangible assets were typical of those assembled and franchised by service companies.

172. Secondly, Dr Asher went through each of the intangible assets and as to each indicated the way in which he understood Amana had taken “advantages” from ProVita. As examples, as to process-based assets he understood that Amana had full knowledge of ProVita’s quality management documents and operating systems, and that it had taken from ProVita employees with specialist expertise in use of its equipment and knowledge in operating a specialist medical care business (he named Mr McGourty, Dr Khaleghian, a former general manager in ProVita’s facility, a doctor in charge of patient recruitment for ProVita, and “some nurses/admin staff that were close to the named team members”). Also as examples, as to reputation-based assets he understood that Amana had used ProVita’s reputation in Abu Dhabi to “leverage [its] credibility”; that Amana had used or copied ProVita’s marketing materials; and that by taking “key people” from ProVita, Amana had significantly shortened the time need to establish client relationships.

173. Thirdly, Dr Asher estimated the relative “values” of the assets at the time of disclosure to Mr Hashemi, with a weighting towards the reputation-based assets because a high-margin business was involved. These were not financial values, but percentages: process-based assets were estimated at 40 per cent and reputation-based assets at 60 per cent, and within each (as examples) know how of staff was estimated at 30 per cent of the 40 per cent and sales process knowledge and key personal relationships was estimated at 35 per cent of the 60 per cent.

174. Fourthly, Dr Asher attached a (financial) value to the assets on a future income approach; that is, by estimating the present value of future economic returns attributable to them. The estimation was by taking projected revenues of ProVita, applying a royalty rate representing what a business would be expected to pay for use of the assets discounted for risk and the time value of money (8 per cent on turnover), and applying a DCF discount rate (20 per cent).

175. Fifthly, Dr Asher split the total asset value in accordance with the estimated relative values earlier struck in order to “determine the value of Intangible Assets which it is alleged that the Amana Management team has access to through Mr Hashemi and is using to compete with ProVita IMC”. In this regard, and conformably with his earlier description of “advantages” taken by Amana from ProVita, Dr Asher said in his report –

“15.2The Claimant makes the case that the management team has access to, through Mr Hashemi, and is using, the following Intangible Assets belonging to ProVita IMC:

1.1.1 Quality manuals and procedures

1.1.2 Specialist proprietary knowledge of equipment used

1.1.3 Benefit of inside knowledge to accelerate licensing and processes for accreditation

1.1.4 Staff proprietary know-how

1.1.5 Indirect branding benefit

1.1.6 Marketing materials

1.1.7 The sales process knowledge and personal relationships formed by ProVita IMC

1.1.8 Inside knowledge of costs, contracts, order book and access to patient pipeline and waiting list”

176. The total asset value at this point was in the range AED 182-246 million, with a central value of AED 214 million.

177. Sixthly, as to each of the assets Dr Asher estimated “the percentage to which these have been leaked to Amana”. For example, the percentage leakage for “staff know how” was 60 per cent, for “marketing materials” was 20 per cent, and for “sales knowledge/relationships” was 50 per cent. Applying the percentages to the AED 214 million, the total leakage value was a central AED 105 million.

178. Dr Asher then took those assets to which he understood Mr Hashemi had “a direct personal access through the confidential disclosures from ProVita IMC”, as distinct from those to which he had access “through others previously working in ProVita IMC”. Those assets were “marketing materials”, “sales knowledge/relationships” and “contract and order book knowledge”, the middle one reduced from a leakage value of 50 per cent to 20 per cent: this was said to be to exclude “that part of the benefit of sales knowledge/relationships associated with the personal relationships established by the former ProVita IMC management team”. Applying these fewer and reduced percentages to the AED 214 million brought a total leakage value of a central AED 37 million.

179. Dr Asher made a check estimation, which need not be described, of the value to Amana of reduced delay in establishing its own facility. The value was in the order of AED 203 million. It is sufficient to say that in my view the bases on which the estimation was made were not sufficiently established, and the process of valuation was too uncertain, to provide comfort for the assessed leakage value.

180. Dr Asher referred, as a further check, to an April 2012 valuation of ProVita, an offer term sheet with a potential investor, and an equity agreement with the ProVita founder in consideration of transfer of information. Again, I do not think these provide any real comfort for the assessed leakage value. It is perhaps odd that Dr Asher relied on the last of these as providing a range which “may be considered equivalent to what Amana would be expected to pay in similar circumstances”, when the circumstances were not similar and the range was much less than the AED 37 million.

181. Finally, Dr Asher applied to the AED 37 million TVM Capital’s 39.4 per cent of PVHC, but because PVHC controlled ProVita he left PVHC’s interest in ProVita at 100 per cent rather than the 49.9 per cent of its shareholding. He thus arrived at a value, which he considered “to be appropriate to consider in the event of aWrotham Parkassessment of damages in this case”, of AED 14.58 million.

182. I have explained Dr Asher’s process of valuation in a little detail, because in my view there are exposed a number of difficulties in accepting his valuation.

183. One is conceptual. The royalty rate is applied to ProVita’s projected revenues, for the indefinite future, not to anticipated revenues of the recipient from the use of the assets. The product may be a value to ProVita, but by no means a value to the recipient. (This is consistent with Dr Asher’s understanding that his task was to value the interest of TVM Capital in the intangible assets). And ProVita’s revenues are derived from all the intangible assets, and much else besides, but the product is then pared down to something representing use of part only of the assets with no necessary relationship with ProVita’s earning of the revenues.

184. Another is that the assets regarded as assets to which Mr Hashemi had direct personal access through confidential disclosures are not at all close to the information disclosed or used in breach of the confidentiality agreement or of Article 37 of the Obligations Law. ProVita’s marketing materials were described “a set of marketing material which it uses to communicate its offering with the market”, which is not an apt description of the ProVita Presentation: and if that were the intention, the leakage would surely have been more than 20 per cent. The McGourty materials bear no real relationship to the two other classes of leaked assets. In particular, the contract and order book knowledge, which gave rise to the lion’s share (AED 25.7 million) of the AED 37 million, was described in Dr Asher’s report as “an active net of long term contracts and a client order book” which ProVita had “based on the key relationships” and which “underpins the revenues and earnings to the company”; this is distant from the infringing uses and disclosures.

185. A third lies in the many occasions of evaluation and estimation, one building upon another. The cross examination raised some doubt about the chosen royalty rate, but apart from that there were evaluations and estimations not just in identification of intangible assets, but in apportionment between them to split the total asset value; again in apportionment for leakage percentages; and again in apportionment for Mr Hashemi’s direct personal access. Dr Asher said in cross examination that he acted upon his experience. But he had no valuation or other experience in relation to a long term healthcare business, or in relation to a healthcare business in the UAE or the wider Middle East. Such evaluations and estimations maybe little more than informed guesses at the best of times, and I do not have confidence in the application of Dr Asher’s experience to produce them in the present case.

186. There may have been other difficulties, but individually and collectively these are such that I do not accept the assessment of negotiating damages at an indirect shareholding or other percentage of AED 37 million. Dr Asher’s assessment is by a form of calculation, but the calculation is only a veneer.

187. In TVM Capital’s submissions I was invited to make adjustments within Dr Asher’s assessment if I saw fit, but I do not think I am in a position to do so. It appears to me that Dr Asher’s valuation of AED 37 million is in any event not a sound basis for an assessment of negotiating damages. Is it likely that, in a negotiation with TVM Capital, Mr Hashemi would have agreed to pay it a sum in the order of AED 14 million so that he could use the confidential information which I have found was misused? He was knowledgeable in the healthcare market. He could devise his own information memorandum, and he could wait for a relatively short period and obtain assistance from Mr McGourty and Dr Khaleghian, who would be able to assist provided they acted conformably with their obligations to PVHC and ProVita Holdings. A business model and financial information from ProVita’s business were no doubt advantageous, but by no means vital. I do not think it particularly likely that TVM Capital would have agreed to any release or relaxation of the confidentiality undertakings, but I must assume that it would have; if it had done so, I think the price would have been nothing like AED 14 million.

188. For completeness, I should return at this point to Mr Hashemi’s companion submission earlier mentioned. Apparently beguiled by Dr Asher’s use of ProVita’s projected revenues, it was that the assessment was of ProVita’s damages and that TVM Capital as an indirect shareholder of ProVita was not entitled to assert a claim to them. This submission is also misconceived. ProVita’s revenues were used as a tool in seeking to arriving at negotiating damages as compensation for TVM Capital’s loss.

189. Although I have not accepted negotiating damages on Dr Asher’s assessment, if there were negotiations to a price for release or relaxation of the confidentiality undertakings the confidential information had a value. The value is a hypothetical, and so far as appears is not ascertainable from market prices. It can be seen from Dr Asher’s valuation and what I have said about it that the hypothetical value of limited use of the confidential information is not readily calculable. But as was said by Mason CJ and Dawson J in the High Court of Australia inCommonwealthvAmann Aviation Pty Limited(1992) 174 CLR 64 at 83 –

“The settled rule, both here and in England, is that mere difficulty in estimating damages does not relieve a court from the responsibility of estimating them as best it can. Indeed, inJonesvSchiffmanMenzies J went so far as to say that the ‘assessment of damages…does sometimes, of necessity involve what is guesswork rather than estimation’. Where precise evidence is not available the court must do the best it can.”

190. Under the Damages Law loss must be established with a reasonable degree of certainty (Articles 11 (1), 27 (1), but this must be read subject to the direction that “[w]here the amount of damages cannot be established with a sufficient degree of certainty, the assessment is at the discretion of the Court” (Articles 11 (3), 27 (3)). This reflects the common law position, and making a best estimate has been regarded as “a jury question” (ThompsonvSmith’s Shiprepairers Ltd(1984) 1 QB 405 at 444 per Mustill J). I note that inForce Indiathe plaintiff claimed compensation of £13,771,419, but the judge concluded that “[l]ooking at matters in the round” the negotiated fee would have been £25,000.

191. Negotiating damages need not attempt to reflect the gain to be made, or made, by the defendant (in the leading detention of goods case ofStrand Electric and Engineering Co LtdvBrisford Entertainments Ltd(1952) 2 QB 246 the damages were the market rate of hire regardless of whether the defendant made a profit from the use of the goods). In the Canadian case ofArbetus Park EstatesvFuller(1976) 74 DLR 3d 257 the defendant carried out building works in breach of a covenant requiring that the plans be approved by the plaintiff, and the damages were the amount saved by not having to draw up plans.

192. In the present case, the ProVita Presentation does not seem to have given Mr Hashemi any particular financing advantage. The approaches to Fajr Capital, Al Zarooni Investments and Al Waha Capital did not bear fruit, investment finance was still being sought in July 2012, and the evidence did not disclose what investment or other finance was obtained for the Amana facilities or otherwise what was done and by whom in bringing them into operation. It is likely that any advantage to Mr Hashemi in establishing his own venture came more from the involvement of Mr McGourty and Dr Khaleghian, and perhaps others, than from the use of confidential information as I have found it. There would be some advantage from a business model and financial information from ProVita’s business, but otherwise a negotiated price for that use would reflect a saving of time and cost to Mr Hashemi in doing work for himself.

193. For its part, TVM Capital would not have been prepared to sell the use of the information to a person who would be seen as a would-be competitor at a low price. (I doubt that it would have sold at all, but as I have said I must assume that it would). But the dominant factor would be how much Mr Hashemi was prepared to pay. He went to some trouble to obtain it illicitly, including misrepresenting to TVM Capital the interest of a wealthy UAE family; ordinarily high worth is placed on one’s credibility, and he must have seen a not insignificant value in having the information. The forecast profits to the platform company in the Avicenna Presentation, after a start-up period, were not inconsiderable, so the contribution of having the information was to an end which Mr Hashemi must have seen as valuable. On a broad assessment, the price at which the parties would have arrived is AED 250,000.

194. I have found a different extent of breaches of the confidentiality agreement and breaches of Article 37 of the Obligations Law. I do not regard the difference as material to the foregoing assessment. The damages are for breach of contract, alternatively breach of Article 37 of the Obligations Law.

Damages: the Alternative Claim

196. A new facility became operational in Al Ain in February 2013 (on Dr Schuehsler’s understanding, but he acknowledged that his information may not have been accurate) or in May 2013 (according to Mr Hashemi). In this instance I consider that Mr Hashemi’s evidence can be accepted. The operator was Long Term Medical and Rehabilitation Hospital LLC, a subsidiary of Avicenna Holdings Ltd.

197. TVM Capital accepted that it could not complain of competition in the market for healthcare services. It said, however, that the entry of an Avicenna / Amana competitor in the market was accelerated by making use of confidential information supplied to or obtained by Mr Hashemi. It suggested that the temporal advantage gained in establishing the new facility was in the order of three years. My acceptance of operation in mid-2013 would make that a lesser period, but it would be difficult on the evidence to quantify a period of acceleration.

198. Dr Schuehsler gave evidence that he believed that “at least five, but likely substantially more by now [9 January 2014]” ventilator dependent patients who would normally have been placed in ProVita’s facilities had been placed with Amana. He said also that the existence of a competitor was used by the national health insurer to force a price renegotiation to lower the fees paid to ProVita.

199. The alternative claim reflecting lost revenue rested upon Dr Schuehsler’s evidence that the insurer had forced a price negotiation to lower the fees paid to it. Dr Schuehsler said that the insurer had reduced the fee paid by it for ProVita’s services from a 3x multiple of the HAAD base rate

Base Rate
to a 2.5x multiple. Dr Asher applied the reduction of 15 per cent to ProVita’s year 2014 anticipated revenues, said that he expected no change in the cost of the services, and arrived at reduced EBITDA of AED 72.6 million. On an acceleration of the entry of an Amana company into the healthcare market by 12 to 15 months, as it seems he was instructed, this gave lost earnings of AED 72.6 – 90.8 million. (The figure would be much larger if the accelerated entry was in the order of two and a half years).

200. I do not accept this as a proper basis for damages. Mr Hashemi submitted that any reduction in fees could not have been because of the entry of Amana competitor, pointing to a document whereby fees were dependant on quality of services. This may not have recognised the realities of commercial life, but the difficulty is greater.

201. Assuming that a reduction in fees was due to entry of an Amana facility into the healthcare market, any accelerated entry was not shown to have been due to misuse of confidential information as I have found it. As I have said, having the ProVita presentation does not seem to have, or at least was not shown to have, assisted in obtaining investment financing. The far greater likelihood is that bringing the Amana facility into operation was assisted by the use of other intangible assets (Mr McGourty, Dr Khaleghian and others, for a start), as Dr Asher was apparently instructed (see paragraph 15.2 of his report, set out above). Be that as it may, I am not satisfied that it was materially assisted by the infringing uses or disclosures of confidential information.

202. TVM Capital’s submissions placed scant reliance on the alternative claim to damages. This was justified.


203. The price for release or relaxation of the confidentiality undertakings, or consent to disclosure of the confidential information, would have become payable at the latest on 29 January 2012 when the Avicenna Presentation was delivered to Fajr Capital. Interest on the AED 250,000 should run from that date. The parties should calculate the interest.


204. TVM Capital has largely succeeded in the proceedings, but I have not accepted its case on quantum. In my opinion, a just result is that Mr Hashemi pay the costs of TVM Capital except the costs of and incidental to obtaining Mr Asher’s reports and calling him as a witness.

Issued by:

Natasha Bakirci

Assistant Registrar


Date of Issue: 22 May 2014

At: 10am