What defines stealing? 6

[MadMango]

In context to thread732-316391

Is offering a separate and different proposal of work to a client "stealing" when it is the client that selects which proposal suits them the best? Or is it the access to the client in the first place that is the ethical dilemma?

"Art without engineering is dreaming; Engineering without art is calculating."


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[stevenal]

Agree. Clients are not owned by an employer, but lists of clients developed on company time using company owned computers and phones from a company provided office are.

We're talking engineering ethics here. Salesmen don't necessarily follow the same code, and many are independent contractors.

 

[patprimmer]

An employer owns the list developed on company time or maybe even on private time while you worked for them.

Once you leave you are free to create similar lists from sources to which you have legal access, like your memory, google and phone books and trade association publications and meetings.

Regards
Pat
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[jmw]

Most people like their computer's memory better than their own.
Once you admit of memory.... you are splitting hairs to talk about what type of memory.

Prospecting after projects you learned about while an employee is one thing. But contact lists? Like most things they are of transient value.

Contacts change all the time. Both the contacts at the client and the clients the company deals with.

They thus have a limited life time unless continuously refreshed.
If companies really worried about contact lists then you can be sure we wouldn't be arguing about the ethics of it here. It would be a specific condition in the contract.
OK so there is a lot that is not in the contract but let's use common sense.

The contact list by itself has little value. It is a simple tool.
What most companies are aware of is that 80% of their business comes from 20% of their clients. That is the important information not in the contact lists and which, if you know your business, you will know who the top 20% are and you don't need the contact list for that. It is just a convenience. Without it you simply recreate it from memory or whatever.
Denying you the contact list therefore does no good because a s means to protect the employer it is of little value.

What they do worry about is if you try to take and existing project.
Next they worry about you trying to take some of their top 20%.
The contact list isn't how they defend against this, it is the no compete clause.



JMW

http://www.ViscoAnalyser.com

 

[MiketheEngineer]

Taking customer lists is STEALING and has been upheld in most courts of law!!

 

[TGS4]

MiketheEngineer - it really depends on whether the list is a physical (i.e. paper) list, or one from memory.

Here's an interesting question, regarding physical contact lists: I am given business cards by every contact that I meet. Who owns those cards? Must I leave all of them when I leave my employer?

 

[stevenal]

"They thus have a limited life time unless continuously refreshed.
"

Thanks for helping me make my point. Not only was the list created on company time, it was maintained on company time as well.

 

[casseopeia]

jmw, you are absolutely right. But even work under contract is not sacred. Any client has the choice of terminating a contract for convenience. If his prize engineer jumps ship, or is dismissed, that client has the choice of following the engineer and terminating the contract with the company if it is to his advantage. The client also has the choice of saying no to the departing engineer for whatever reason what-so-ever. Maybe the contract has a very stiff penalty for termination or maybe it would sour a valued relationship. Maybe it's too much trouble to change or the client is afraid of legal hassles.

I have personal experience with this. When I owned my own firm 10 years ago, I had two employees start a competing business, taking with then 12 projects under contract. I took them to court. I had good attorneys. I lost. I did not win one single aspect of the motion that was filed. One of the claims was tortious interference. I got less than nothing. I didn't even get awarded termination costs. I spent a bundle in legal fees.

Loading up a company car with the server, five desktop computers, the petty cash box, and driving to Mexico is stealing. Taking a short-shelf-life client list is not. It doesn't matter if the client list comes from your memory or your memory stick. Fear of reprisal for taking so-called company property is little more than psychological warfare against an uninformed workforce.

"Gorgeous hair is the best revenge." Ivana Trump

 

[jmw]

stevenal,
I didn't say made on company time but your point is valid even if we allow that the list is created by people entering details from business cards they collect. It would be created on company time and with company resources.
But it has to be maintained to be of value. Mostly this includes simply adding new contacts. It may involve deleting a few bad payers or those that have gone out of business but those not in the top 20% that deliver 80% of the business are usually assumed to be still in the bottom 80% who pad out the list.

The point is most such lists are filled with useless names.
The list itself is a convenience and has little real value.
If you wanted to could buy a list from pretty well any source.
Magazines regularly sells such lists. Or you can usually recreate such a list from pretty much anywhere.
Heck, companies often start with such bought in lists.
So the chances are you could buy a list commercially which could contain the companies that are also in your employer's list and often the names of the relevant people. But the names change most rapidly of all and as often as not getting the right name is no problem. Not even for the most wet behind the ears salesman. Just call whatever name you have and then ask for it.

As I said, the list itself doesn't have any real value.
What does have value is knowing who among them is spending money and regularly spends money. The list doesn't tell you that but if the list is to be any use to you, you have to know that already i.e. in your mind.

I'd be interested to see any cases of prosecutions exclusively based on the contact list and which found in the employers favour.
Some such cases are simply malicious. The general response of companies is "who cares?"

For example my boss at one company was hauled back from the USA (due to some brown nosing politicking) and told they would find him a new job in the UK. He didn't like the new job they found but had nothing better so accepted it.
Two days later he was offered a job with a global company which was a competitor (the way an elephant competes with a mouse).
He immediately accepted the new job (much better than any with his current employer) and politely resigned his current two day old job.
The CEO was incensed.
He then wrote a very malicious slanderous character attack and sent it to his new employer.
The new employer was no dummy. If anything I reinforced the idea they got the right man. So when my old boss took his chance, flew back to the States and walked into his new employer all nervous and spoke to them about the letter they laughed and gave him an unexpected signing bonus.
The point is that one or two cases may not be evidence of anything at all except malice and expensive lawyers.
Most companies also can choose to send a circular to their clients saying "So and so has left the company and is no longer associated with us."
If they are at all good they shouldn't need to worry about losing key clients, not if they look after them well.
It isn't even as if they are deprived of the contact list which would be cause for upset.


JMW

http://www.ViscoAnalyser.com

 

[patprimmer]

The fact that the list is dynamic and that different clients have different values in no way affects the ownership. What is on paper, cardboard or electronic media is the companies. What is in your memory is yours at least with regard to client lists. Details in quotes and projects are normally the companies.

The laws vary from jurisdiction to jurisdiction as does enforceability.

After a reasonable time, is very hard to prove a list was not compiled after you left a company so long as all information is available by outside means or by reasonable memory.

On the other topic of Pareto principle

http://en.wikipedia.org/wiki/Pareto_principle

it of course looks to the past, not the future and rigid application of resources based solely on it leads to a declining future

Regards
Pat
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[MiketheEngineer]

What is in your memory is yours - but taking a disk or hard copy of customers - I find to be ethically unacceptable.... PERIOD

 

[TGS4]

Mike - I would tend to agree with what both you and Pat are saying. But what about business cards? Does that constitute a "client list"?

 

[patprimmer]

Technically, I would think a business card is a document, so should be classed with other documents that belong to the company. I think that one would be harder to enforce if we are talking about risk of law suit rather than clear conscience which are of course two entirely different things.

Of course people often steal then justify it, sometimes even with good cause. Calling in sick when not sick is stealing if push comes to shove.

Stealing a sick day when the boss rejects a legitimate overtime claim may be justified on the grounds they stole from me so I am stealing back.

Putting in a bogus expenses claim to offset a legitimate claim that was knocked back, same deal, however it probably would not stand up in court.

Regards
Pat
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[MacGyverS2000]

If a client list made from memory is not stealing, but taking business cards is... does that mean people with eidetic memories can get away with more? It seems classifying whether or not someone is stealing by how good their memory is constitutes the beginning of a slippery slope.

Dan - Owner

http://www.Hi-TecDesigns.com

 

[casseopeia]

Something that is considered by some to be unethical is not necessarily the same as theft, or stealing.

I found this from Nolo's website which reinforces the concept that a client list, if ascertainable through independent means (phone book, trade associations, dusty business cards tucked between coupons for frozen dinners for two, etc.), is not protected intellectual property. Interestingly, if the employee contributed to compiling the list, it is less likely to be considered the private intellectual property of the company.

The only case law I have found is from South Carolina, Atwood v Black, where the ruling was in favor of the departing employee who used a list of potential renters and property owners with places for rent. Feel free to find a case where the ruling was in favor of the company over a departing employee who took a client list. I haven't found a single citation supporting that view.

CUSTOMER LISTS

Companies are often very eager to protect their customer lists with NDAs, particularly when a former employee might use a customer list to contact clients. If a dispute over a customer list ends up in court, a judge generally considers the following elements to decide whether or not a customer list qualifies as a trade secret:

Is the information in the list ascertainable by other means? A list that is readily ascertainable cannot be protected.

Does the list include more than names and addresses? For example, a customer list that includes pricing and special needs is more likely to be protected because this information adds value.

Did it take a lot of effort to assemble the list? A customer list that requires more effort is more likely to be protected under an NDA.

Did the departing employee contribute to the list? If the departing employee helped create it or had personal contact with the customers, it is less likely to be protected under an NDA.

Is the customer list personal, long-standing or exclusive? If a business can prove that a customer list is special to its business and has been used for a long time, the list is more likely to be protected.

"Gorgeous hair is the best revenge." Ivana Trump

 

[patprimmer]

Dan

It is a slippery slope and where the line should be drawn involves a lot of variables.

Lots of things that give an advantage to business depend on memory.

Regards
Pat
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[jmw]

Mike the Engineer:

Taking customer lists is STEALING and has been upheld in most courts of law!!

This seems to be at odds with what Cass has researched.
It would now be a good time to reveal your references.


JMW

http://www.ViscoAnalyser.com

 

[jmw]

By the way, one of the prime objectives of a lot of internet organisations is to acquire contact lists.
I guess there are people who keep private and company lists separate but I'd guess that most every companies contact list is somewhere on the internet and certainly held by Facebook, Linked in Plaxo and a variety of others who all invite users to upload their contact lists.
Most especially those that serve industry needs.
I'd guess Linkedin probably has more company contact lists than any other site.
Now to what extent you can rebuild the contact list through such organisations is uncertain. (Well not with Plaxo. When changing computers I found this the easiest way to transfer my contact lists from one computer to another. Until they shifted this feature into the pro version and I stopped using them... (see Dilbert because this is exactly how dotcoms work.)

JMW

http://www.ViscoAnalyser.com

 

[stevenal]

"The point is most such lists are filled with useless names."

If the list is useless, why take it?

"... does that mean people with eidetic memories can get away with more?"

Yes. Not fair, but those with such memories probably have other unfair advantages as well.

"Is the information in the list ascertainable by other means? A list that is readily ascertainable cannot be protected."

Which suggests a very easy solution to the question. If the list is readily ascertainable by other means, then readily ascertain it by other means. Then there will be no question.

 

[patprimmer]

stevenal

Exactly.

Regards
Pat
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[jmw]

You pan the list for the gold.
What is gold to one is often not to another.

What may be useless to the company could be very useful to a small start up.
And the company probably has the top 20% pretty well sewn up, if they are any good and don't fear losing them. They will even structure their business pans around what keeps these people happy.

They won't worry about losing the supposed one time buyers in the list and will know that with limited resources no one man band is going to make much inroads into the 80% from whom 20% of the business comes.

What is forgotten too is that many start up companies start because the original company has defined its business path and will follow certain strategies appropriate to it. They will focus not shotgun.
That means quite a few new avenues will be ignored.

There are lots of such companies out there that started in this way.
Clients A to H are the 20% who buy 80%.
What they buy is where the company invests its resources.

But some employees see opportunities being passed up they feel should be followed.

We all know of spin off companies located almost next door to the obvious ancestor company. Essentially in the same market but with a different angle.

They usually then diverge some what.

There are lots of very good reasons why a contact list copied is no real danger.

I still wait for the evidence of companies treating this as a serious problem.

Otherwise this is in the realms of "cultural" differences.



JMW

http://www.ViscoAnalyser.com