Tabatha Pelkey had worked at Physical Fitness Equipment Sales Ltd. as its manager for six years; she left following a pay dispute with the owner. A few weeks later, she opened her own store just 18 blocks from Physical’s site. She sold the same exercise equipment to the same market and featured an almost identical sign. Her business was instantly successful and had a serious negative impact on Physical’s operations. Could Physical successfully sue Pelkey for breach of confidence? What would Physical need to prove to be successful? How could Physical have protected itself from competition from Pelkey?
This situation is based on the following case:
Physique Health Club Ltd. v. Carlsen (1996), 141 D.L.R. (4th) 64 (Alta. C.A.), leave to appeal dismissed, [1997] S.C.C. No. 40.