A former Qantas senior executive has been fined $25,000 for contempt in a Singapore-based court, after jumping ship to work for Virgin.
Previously the CEO of Qantas subsidiary Jetstar Japan, Nick Rohrlach was found to have breached a court injunction not to begin working for Qantas rival Virgin before the conclusion of the lawsuit, which was sparked in March and heard in the Supreme Court of Singapore.
Rohrlach had accepted a senior role at Qantas Frequent Flyer, before ultimately taking the top job at Velocity, and Qantas told the court that “highly sensitive” information had already been shared with him, prior to his move to Virgin.
As such, Qantas attempted to compel the court to legally enforce a six-month non-compete clause within his employment contract.
Qantas later successfully imposed an injunction that would delay Rohrlach’s start date at Velocity until 18 September, or the conclusion of the court case, whichever was earlier.
In compliance with this conjunction, Rohrlach officially began his role as Velocity CEO on 20 September, however, Supreme Court Justice Mavis Chionh found that Rohrlach breached this injunction on two occasions prior to this date, by assisting Virgin to recruit other potential employees.
The court found that the former Qantas executive had, on one occasion, sent an email connecting a Virgin staff member with the CEO of a recruitment startup.
The second breach occurred when Rohrlach attended a video meeting with a potential future Virgin employee, after being asked to do so by a member of Virgin’s senior leadership team.
Rohrlach’s team argued that he had not intentionally breached the injunction.
He argued that in the first instance, he had simply been connecting an old friend and former colleague with the Virgin employee, and that the second incident was merely a social meeting.
However, Justice Chionh found that Rohrlach’s motives were irrelevant, and that both incidents were a clear breach of the injunction.
Justice Chionh said that the act of sending the email connecting a Virgin staff member and a recruitment specialist in itself breached the court order, regardless of intention, and that the video meeting between a potential employee would not have occurred had a senior Virgin leader not requested it to.
Qantas’ legal team, led by Senior Counsel Jason Chan, requested a five-day jail term as a consequence of Rohrlach’s breach, arguing that the former Qantas employee did not act under pressure and had repeated breaches of the injunction.
Meanwhile, Justice Chionh ruled that a jail term was not warranted.
The court case to determine the validity and enforceability of Rohrlach’s Qantas non-compete clause is still ongoing.
Qantas successfully won its last-minute injunction to stop the “defecting” new Velocity CEO from starting his job in March, which delayed his official start date until September.
Qantas’ injunction win was significant, given it lost two previous cases requesting to hold the full hearing in Australia rather than Singapore, whose courts traditionally favour employees.
Virgin reacted to the injunction ruling by issuing a statement saying it “categorically denies allegations that it has been anything but proper and appropriate” and is confident it will be “vindicated” in court.
“We look forward to welcoming Mr Rohrlach to the Virgin Australia family with open arms and showing him why we are Australia’s most loved airline with a winning team that attracts the very best,” the business said at that time.
The case was complicated by the fact that Rohrlach signed the Velocity contract in Singapore, and also applied for anti-suit protection there to stop Qantas from enforcing its six-month non-compete clause.
Qantas argued in the NSW Supreme Court initially that the case should be held in Australia because subsequent agreements nullified another clause in the contract to only allow legal action to take place in Singapore.
It also argued holding it in Australia would be more convenient to all parties.
However, Justice David Hammerschlag said in the first hearing that Qantas only “faintly” argued its case and said its submission was “unsustainable”.
“The choice of jurisdiction is clear,” Justice Hammerschlag said. “There is no challenge to the jurisdiction of Singapore … that the proceedings have to be conducted remotely and that the parties will be separated from their Australian lawyers are matters of mere inconvenience. Remotely conducted proceedings have been the order of the day for more than a year now.”
The judge ordered Qantas to pay Rohrlach and Virgin’s costs.
Qantas then called the manner of Rohrlach’s defection “an inglorious sequence of events” before its rival hit back by arguing that it was disappointed “the dominant market player” had “chosen to attack us rather than get on with the job at hand”.
“At this particularly critical juncture, with vaccines rolling out and new virus variants emerging, Australian airlines need to work to get our country flying again,” Virgin added.
Qantas then lost an appeal in March to hear the case in Australia.