Telangana High Court Restrains Ex Karix Mobile Employees From Sharing Trade Secrets With Competitor

Holding that the sudden loss of a major client gave rise to an “unshakable inference” of breach of confidence, the Telangana High Court has set aside a trial court order and granted interim protection to Karix Mobile Private Limited against its former senior employees who joined competitor OneXtel Limited.

A Division Bench of Justice Moushumi Bhattacharya and Justice Gadi Praveen Kumar allowed the appeal and overturned the October 6, 2025 order of the trial court, which had rejected Karix's plea for a temporary injunction against its former employees.

The High Court said the chain of events, especially the abrupt halt in business from one of Karix's largest clients soon after the employees resigned and moved to OneXtel, could not be brushed aside as coincidence.

Records submitted before the court show that three senior employees resigned between late 2024 and early 2025 and joined OneXtel shortly thereafter, setting off a sequence of events that culminated in the loss of a key client.

Within months, Karix's business with Twilio came to a standstill. Internal correspondence relied upon by Karix recorded that the procurement head of the client had indirectly confirmed receiving a call from one of the former employees seeking diversion of business. Karix also alleged that only that employee had access to data required to redirect sender IDs.

A significant piece of evidence was an email dated July 17, 2025. An employee of OneXtel emailed one of the former Karix employees, who had by then joined OneXtel, regarding technical release details of its ILDO platform.

In replying, the former employee marked the email to a current Karix employee using his official Karix email ID. The High Court treated this as a significant red flag and described it as part of a “pre-meditated design” to misuse proprietary information.

The bench held that the trial court erred in failing to mark this email and wrongly reduced the dispute to one concerning a mere “list of clients.” It observed that “the information disclosed by the appellant in its rejoinder reflects that the information is calibrated, specialised, exclusive and extends far beyond 'client lists'. In other words, the information amounts to a proprietary asset or an intellectual property right of the appellant, the use of which is within the appellant's exclusive domain.”

The Court further remarked that the “Trial Court's reduction of the entire case of the appellant only to that of a 'list of clients' not only trivialises the issue but fails to recognise that modern day business.”

Addressing the balance between employment mobility and confidentiality, the bench stated that an individual's right to seek better employment cannot “trample upon the right of the erstwhile employer” to protect proprietary confidential information.

Rejecting the respondents' reliance on Section 27 of the Indian Contract Act, 1872, the Court clarified that while agreements in restraint of trade are void, protection of trade secrets and confidential information survives termination of employment.

Allowing the appeal, the High Court set aside the trial court order and granted interim injunction restraining former Karix Mobile employees from disclosing or utilizing its confidential information in favor of OneXtel.