Executive Summary: Key Legal and Evidentiary Issues

• Former key employee was found to have misused confidential information and source code to develop competing software.

• Adverse inference was drawn against the defendant for failing to produce Visual Basic source code, based on credible witness testimony.

• Trial judge awarded $750,000 in disgorgement damages for breach of fiduciary duty and breach of confidence.

• Court of Appeal upheld the findings of liability but ruled that part of the claim—related to a specific business opportunity—was time-barred.

• Damages were reduced to $518,659.26 after excluding profits from the statute-barred TCS Opportunities claim.

• Appeal resulted in partial success for the defendants, who also received $20,000 in costs.

Facts and outcome of the case

Guy Roberge was employed by Total Meter Services Inc. (TMS) as a software developer and continued briefly as an independent contractor after leaving the company. During that time, he maintained access to confidential source code and client information. He later founded GVM Integration, which developed and sold competing software products allegedly derived from TMS’s proprietary tools.

TMS sued Roberge, GVM Integration, and co-defendant Bryce McKiernon for breach of fiduciary duty and misuse of confidential information. At trial, the court found that Roberge used TMS’s source code to create competing software and solicited TMS clients, exploiting his insider knowledge to give GVM a commercial head start. Witness testimony, particularly from McKiernon, confirmed that the original source code was written in Visual Basic but was later converted to C#—obstructing meaningful comparison during litigation. The trial judge drew an adverse inference due to the incomplete disclosure and awarded $750,000 in disgorgement damages.

On appeal, the defendants challenged the trial judge’s adverse inference and argued that a key part of the claim, involving a business opportunity with Total Control Systems (TCS), was brought outside the statutory limitation period. The Court of Appeal upheld the finding of liability, confirming the adverse inference was appropriate and procedurally fair. However, it agreed that the TCS Opportunities claim introduced a new cause of action too late and was therefore statute-barred.

The Court recalculated the damages award to exclude profits related to the TCS contract, reducing the total from $750,000 to $518,659.26. It also awarded the appellants $20,000 in appeal costs and invited submissions on adjusting trial costs to reflect the partial success.

In conclusion, the appeal resulted in partial success for the defendants, who remained liable for the core claims but succeeded in significantly reducing their financial exposure due to the successful limitation defence. The case highlights important principles in fiduciary obligations, use of confidential information, and procedural limitations in commercial disputes.