Freshasia Foods Ltd v Jing Lu

Freshasia Foods Ltd v Jing Lu: Short summary

Defending an employee's right to work against an aggressive injunction.

The problem: Our client, a marketing professional, left his job at a food company (Freshasia) for a competitor. Freshasia sought an urgent High Court injunction to enforce broad non-compete/non-solicitation clauses, seemingly aiming to stop him from working entirely.

Our action & the result: We successfully defended the interim injunction application. We argued the non-compete was unreasonably wide (potentially banning unrelated roles across the UK/EU) and likely unenforceable. We also challenged the non-solicitation clause for ambiguity and lack of proven legitimate interest. The court refused the non-compete injunction, allowing our client to keep his job, granting only a narrow non-solicitation order pending trial. Freshasia ultimately lost and, due to their unreasonable conduct, paid our client's costs on the indemnity basis (over £140k).

Freshasia Foods Ltd v Jing Lu: In detail

When an employee leaves for a competitor, the former employer's reaction can be swift and severe. Jing Lu, a marketing professional in the specialist Asian foods sector, found himself facing exactly that: an urgent High Court injunction application from his previous employer, Freshasia Foods, just before Christmas.

Freshasia, a leading supplier, sought to prevent Mr Lu from working for his new employer, a competitor. They relied on broad non-compete and non-solicitation clauses in his employment contract, alongside allegations of confidential information misuse. For Mr Lu, the stakes were incredibly high, potentially losing his new job, his income, and impacting his right to remain in the UK. Mr Lu engaged Virtuoso Legal to fight the injunction.

Our action and the result

We immediately challenged the enforceability of Freshasia's restrictive covenants. We argued that the non-compete clause, initially purporting to last 10 years and later argued for one year across the UK and EU, was excessively broad and unnecessary to protect Freshasia's legitimate business interests. We also highlighted ambiguities and a lack of justification for the non-solicitation clause.

At the initial urgent hearing, the Deputy High Court Judge refused Freshasia's primary request to stop Mr Lu from working in his new role pending trial. This immediate victory was critical, allowing Mr Lu to keep his job. The court granted only a much narrower interim injunction, limited to specific non-solicitation activities based on prior personal dealings, reflecting the weaknesses in Freshasia's broader case.

Ultimately, Freshasia's aggressive stance backfired. Their claims largely failed, and due to their conduct (including rejecting reasonable settlement offers), we successfully argued they should pay Mr Lu's costs on the more favourable "indemnity basis," resulting in an award of over £140,000.

The takeaway for innovators and employees

Employment contracts, especially restrictive covenants, can have a huge impact on your future career. Overly broad clauses may be unenforceable. Defending your right to work, particularly against urgent injunctions, requires specialist, rapid legal action. Understanding your contract and seeking expert advice early is vital.

Facing restrictive covenant issues from a former employer? Contact our specialist team for a confidential discussion.

The legal deep dive: challenging restrictive covenants at the interim stage

For legal professionals, Freshasia v Lu provides valuable insights into defending against interim injunction applications based on post-termination restrictions, particularly where the merits are questionable.

1. Scrutiny of non-compete clauses: The court applied the established principle that non-compete clauses are viewed strictly and must be no wider than reasonably necessary to protect legitimate interests (confidential information, trade connections).

• • Overbreadth: The clause preventing Mr Lu from being "own[ing], manag[ing], operat[ing], consult[ing] or be[ing] employed in a business substantially similar to or competitive with" Freshasia across the UK and EU was deemed likely unenforceable. It prohibited roles (e.g. recipe tester, dumpling maker) unrelated to any legitimate interest Freshasia might have had in restraining Mr Lu's marketing activities.
  • Lack of Legitimate Interest: The judge was unconvinced that a non-compete was necessary beyond tailored non-solicitation/non-dealing provisions, especially given disputes over Mr Lu's actual level of customer contact. The court recognised that preventing someone from earning a living requires a strong justification.

2. Challenging non-solicitation clauses: Even non-solicitation clauses require clarity and justification:

• • Ambiguity: The contract differentiated between "senior" and "non-senior" employees for the restriction period (12 vs 6 months) but failed to specify Mr Lu's status, creating uncertainty.
  • Lack of Legitimate Interest (Fact-Specific): There was a significant dispute over Mr Lu's actual customer dealings. The court acknowledged that if he hadn't had recent, significant contact, Freshasia might lack the necessary interest to protect via solicitation restrictions. This highlights the importance of factual evidence even at the interim stage.
  • Severance: Although the injunction proceeded on a narrower basis pending trial, the judgment acknowledged the complexities around severing potentially invalid parts of a single covenant, referencing the then-pending Supreme Court decision in Tillman v Egon Zehnder Ltd.

3. Interim injunction principles in restrictive covenant cases: The court recognised that where an interim injunction might effectively dispose of the action (e.g. by causing the employee to lose their job permanently or face visa issues), a simple "serious issue to be tried" test (American Cyanamid) is insufficient. The court must consider the practical realities and likely prospects of success, taking the course carrying the lower risk of injustice (Lansing Linde v Kerr; Films Rover). The severity of the proposed restriction influences the intensity of scrutiny required.
4. Indemnity costs: The successful argument for indemnity costs underscores that unreasonable conduct by a claimant in pursuing weak claims, particularly after rejecting reasonable settlement offers, can lead to costs awards exceeding the standard basis, even in employment disputes.

Summary of key litigation points

This case demonstrates the critical importance of challenging the enforceability of restrictive covenants robustly at the earliest stage, particularly in response to interim injunction applications. It highlights the court's willingness to scrutinise the necessity and proportionality of non-compete clauses and the need for clear drafting and demonstrable legitimate interests for non-solicitation clauses. We provide expert support for employees defending their right to work and for firms seeking specialist counsel in complex restrictive covenant disputes.

Dealing with an urgent restrictive covenant injunction? Reach out to our litigation team for immediate, confidential advice.