Executive Summary: Key Legal and Evidentiary Issues

• Openware Information Systems Consulting Company brought a motion under Rule 32.01 of the Rules of Civil Procedure to compel forensic inspection of a laptop retained by its former employee, Eyad Mohammad Arab.
• Central to the dispute is whether Mr. Arab misused Openware's confidential and proprietary information in breach of fiduciary and other duties owed to Openware.
• Contested is Mr. Arab's claim that the laptop was gifted to him by Openware, though the court found this did not affect the necessity of the inspection.
• Privacy objections were raised by Mr. Arab on the basis that the laptop contained personal emails, family photographs, and financial records.
• Kroll, LLC was proposed as the independent third-party forensic examiner, tasked with imaging, USB device analysis, browser history analysis, email analysis, recently used application analysis, deleted file analysis, and keyword searches.
• Proportionality and prejudice were weighed by the court, which found that Openware's need to establish its case outweighed any temporary inconvenience to Mr. Arab.

Facts of the case

Openware Information Systems Consulting Company, a Kuwaiti firm operating as an information solutions and services provider, commenced an action against Eyad Mohammad Arab, a former employee. During his employment, Mr. Arab was issued a 15-inch MacBook Pro laptop by Openware. Following the end of his business relationship with Openware — which the court noted occurred at some point in 2020 — Mr. Arab retained the laptop, claiming Openware had given it to him as a gift. Mr. Arab acknowledged during his examination for discovery on August 8, 2024, that the laptop still contained Openware documents and that he continued to access those documents for discovery purposes. The laptop also remained connected to cloud-based storage containing Openware information.

Openware alleged that after his resignation, Mr. Arab solicited at least one Openware employee, started two companies that compete with Openware, diverted business away from Openware to those companies, and on multiple occasions threatened to disclose Openware's confidential and proprietary information. Openware further alleged that Mr. Arab wrongly used its confidential information to file objections to Openware's bid for a contract with Kuwait Oil Company, which resulted in Openware losing that contract. Openware's statement of claim was issued on October 22, 2022.

Duties and obligations at issue

Openware alleged that Mr. Arab owed duties to refrain from misusing or disclosing its confidential information — including for his own personal use or advantage after termination — from soliciting Openware's employees, customers, and opportunities, and from exploiting business opportunities he became aware of through his employment. Openware sought, among other relief, a declaration that Mr. Arab misused its confidential or proprietary information and technology, breached his duty to keep all such information in strict confidence, and unlawfully interfered with Openware's economic interests and business relationships. Openware also sought injunctive relief requiring Mr. Arab to cease using or disclosing its confidential information, return all such information in his possession, and disclose the identities of any persons or companies to whom that information had been provided.

Court's reasoning and analysis

The court applied the framework under Rule 32.01(1) of the Rules of Civil Procedure, which permits an order for inspection of personal property where it appears necessary for the proper determination of an issue in a proceeding. The court considered whether the inspection was necessary, whether Mr. Arab would suffer prejudice, and how the balance of prejudice weighed against the benefit of the inspection. "Necessary" was interpreted as useful or probative of an issue, requiring a reasonable probability that the inspection would reveal something useful to the trier of fact.

Associate Justice Rappos was satisfied that the inspection was necessary. Mr. Arab did not dispute that the laptop contained Openware information, and he admitted to continuing to access that information since leaving Openware. The court found that a forensic review was the only available method for determining how often Mr. Arab accessed the information and whether he copied or transferred it to other sources. The proposed protocol — to be conducted by independent third party Kroll, LLC — was found to be narrow and focused on Openware matters, with safeguards to protect Mr. Arab's personal data. The court also noted that during cross-examination for the motion, Mr. Arab acknowledged he had purchased a new computer and that his personal data could be transferred to it, substantially addressing his privacy concerns. On the issue of ownership, the court found it immaterial to the motion, noting that whether the laptop was a gift did not alter the fact that it held Openware's confidential information that Mr. Arab had been accessing since 2020.

Ruling and overall outcome

Openware's motion was granted. Associate Justice Rappos ordered that the laptop be delivered for inspection by Kroll, LLC. The court declined to rule on costs at the time of the decision, strongly urging the parties to reach an agreement on the matter and directing them to contact the Assistant Trial Coordinator if they could not. No specific monetary award or damages amount was ordered in this decision.