“10. From August 2019 onwards, Crypton engaged in discussions and negotiations with a number of third parties with a view to attracting investment into Crypton. One such third party was Blockchain SA. In late 2019 the negotiations between Crypton and Blockchain SA developed into a proposed acquisition by Blockchain SA of the entire share capital, business and assets of Crypton, including the Crypton Platform. 11. However, instead of seeing through the negotiations with Crypton to a concluded acquisition, Blockchain instead entered into a wrongful combination with Mr Jones, Mr Koumpas and Mr Curtis (and/or Castramet) pursuant to which these individuals simply purported to resign from Crypton and were engaged by Blockchain almost immediately thereafter. 12. Blockchain and the individual Defendants referred to above then proceeded to solicit other key staff from Crypton, and (it is to be inferred) Blockchain is now exploiting the Crypton Platform, using Crypton’s intellectual property, and/or seeking to rebuild that platform using the ideas and concepts used to create it, and the skill, expertise and know-how of those of its employees and contractors who had contributed to its development. 13. Blockchain has made no payment of any kind to Crypton in return. 14. As set out in more detail below, the wrongful combination between the Defendants first involved Mr Jones, Mr Koumpas and Mr Curtis seeking to take control of the process of negotiation between Crypton and Blockchain SA, and of Crypton’s technology assets and data. They did so: 14.1. With a view to ensuring that they were able to decide on whether and (if so) on what terms the acquisition took place, purporting in breach of duty to agree terms which were contrary to Crypton’s interests and instead favoured Blockchain SA and these individuals. Blockchain SA had offered a bonus pool to transferring employees and, as Mr Jones explained at the time, he wanted to “keep the head count down” so that there was “more money in the pot for us”
“(2) The court may strike out a statement of case if it appears to the court – (a) that the statement of case discloses no reasonable grounds for bringing or defending the claim.”
“The following are examples of cases where the court may conclude that particulars of claim (whether contained in a claim form or filed separately) fall within rule 3.4(2)(a): (1) those which set out no facts indicating what the claim is about, for example ‘Money owed£5000 ’, (2) those which are incoherent and make no sense, (3) those which contain a coherent set of facts but those facts, even if true, do not disclose any legally recognisable claim against the defendant.”
“The second principle, which is quite distinct, is that an allegation of fraud or dishonesty must be sufficiently particularised, and that particulars of facts which are consistent with honesty are not sufficient. This is only partly a matter of pleading. It is also a matter of substance. As I have said, the defendant is entitled to know the case he has to meet. But since dishonesty is usually a matter of inference from primary facts, this involves knowing not only that he is alleged to have acted dishonestly, but also the primary facts which will be relied upon at trial to justify the inference. At trial the court will not normally allow proof of primary facts which have not been pleaded, and will not do so in a case of fraud. It is not open to the court to infer dishonesty from facts which have not been pleaded, or from facts which have been pleaded but are consistent with honesty. There must be some fact which tilts the balance and justifies an inference of dishonesty, and this fact must be both pleaded and proved.”
“i) Fraud or dishonesty must be specifically alleged and sufficiently particularised, and will not be sufficiently particularised if the facts alleged are consistent with innocence: Three Rivers. ii) Dishonesty can be inferred from primary facts, provided that those primary facts are themselves pleaded. There must be some fact which tilts the balance and justifies an inference of dishonesty, and this fact must be pleaded: Three Rivers at [186] (Lord Millett). iii) The claimant does not have to plead primary facts which are only consistent with dishonesty. The correct test is whether or not, on the basis of the primary facts pleaded, an inference of dishonesty is more likely than one of innocence or negligence: JSC Bank of Moscow v Kekhman[2015] EWHC 3073 (Comm) at [20]-[23] (Flaux J, as he then was). iv) Particulars of dishonesty must be read as a whole and in context: Walker v Stones[2001] QB 902 at 944B (Sir Christopher Slade).”
“62 On a date or dates prior to14 February 2020 , which Crypton is presently unable to particularise further (but in respect of which it will seek to plead further as appropriate upon provision of further information upon disclosure or otherwise), Mr Jones and Mr Koumpas entered into a combination or agreement to act in their own interests and against Crypton’s interests with regard to the Crypton Platform Opportunity and the proposed Blockchain SA acquisition. Mr Curtis (and/or Castramet) and Blockchain were also party to the said combination or agreement….”
“For inducing breach of contract the essential elements were knowledge of the contract, intention to induce a breach of the contract and actual breach of contract. Accordingly, to be liable, a person must know that his action will result in a breach of contract….The defendant’s conduct must actually have caused a breach of that contract.”
“Fourthly, A must induce B to break his contract with C by persuading, encouraging or assisting him to do so….It is clear from BMTA v Salvadori and BMTA v Gray that the tort or delict is not confined to circumstances where A has to persuade B to break his contract but can also be committed where A has dealings with B which A knows are inconsistent with the contract between B and C. In either event A induces or assists B to do something (or to refrain from doing something) which involves B breaking his contract with C.”
“102 [The conduct of Blockchain pleaded in paragraphs 72 to 81] was dishonest by ordinary standards. In support of that contention Crypton relies on the following: 102.1 Blockchain had knowledge of, alternatively was reckless as to, the non-solicitation, non-competition and notice obligations to which Mr Jones and Mr Koumpas were subject and the notice obligations under the Contracts for Services. 102.2 Blockchain (including in particular Mr McGarraugh) must have known that it was wrong for Mr Jones and Mr Koumpas as directors of Crypton DA and Crypton PM, having spent significant time and effort developing the Crypton Platform (and overseeing its development by others) and thus creating the Crypton Platform Opportunity, instead to exploit that opportunity outside of Crypton. 102.3 It was in any event dishonest by ordinary standards for Blockchain (acting in particular through Mr McGarraugh), having pursued negotiations for an acquisition of Crypton in return for payments of significant value, for several months and to an advanced stage, to decide instead to exploit the Crypton Platform Opportunity for itself, having been involved in the solicitation of Crypton’s staff as pleaded in paragraph 75 above, and without any payment to Crypton. 102.4 Blockchain SA put forward reasons for withdrawing from the negotiations with Crypton which were not genuine commercial reasons but a false pretext put forward in an attempt to justify its conduct, as set out in paragraph 78 above.” 102.1 Blockchain had knowledge of, alternatively was reckless as to, the non-solicitation, non-competition and notice obligations to which Mr Jones and Mr Koumpas were subject and the notice obligations under the Contracts for Services. 102.2 Blockchain (including in particular Mr McGarraugh) must have known that it was wrong for Mr Jones and Mr Koumpas as directors of Crypton DA and Crypton PM, having spent significant time and effort developing the Crypton Platform (and overseeing its development by others) and thus creating the Crypton Platform Opportunity, instead to exploit that opportunity outside of Crypton. 102.3 It was in any event dishonest by ordinary standards for Blockchain (acting in particular through Mr McGarraugh), having pursued negotiations for an acquisition of Crypton in return for payments of significant value, for several months and to an advanced stage, to decide instead to exploit the Crypton Platform Opportunity for itself, having been involved in the solicitation of Crypton’s staff as pleaded in paragraph 75 above, and without any payment to Crypton. 102.4 Blockchain SA put forward reasons for withdrawing from the negotiations with Crypton which were not genuine commercial reasons but a false pretext put forward in an attempt to justify its conduct, as set out in paragraph 78 above.”
“Insofar as Blockchain has received any of Crypton’s assets (including, without limitation, Crypton’s Intellectual Property) by reason of the breaches of fiduciary duty of Mr Jones and Mr Koumpas pleaded in paragraph 83 above, in the circumstances pleaded above such receipt was unconscionable. Crypton reserves the right to seek to plead further in this respect upon disclosure or otherwise.”
“The Defendants intended by such combination or agreement to injure Crypton, in particular in that such injury was the obverse side of the coin to the financial gain which they sought for themselves by the exploitation of the Crypton Platform Opportunity.”