Holding Data Hostage

Those in the data hosting industry may wish to revisit their contractual arrangements in view of a recent Court of Appeal decision in England. The case of Your Response Ltd v Datateam Business Media Ltd [2014] EWCA Civ 281 has confirmed that suppliers have no right to retain electronic data pending payment for their services, in the absence of any contractual provision to that effect.

BACKGROUND

Datateam is a publisher, which keeps a database of subscriber information requiring frequent daily adjustments. Your Response is a database manager, which entered into a contract with Datateam for the management (including maintenance and updating) of its electronic database.

The contract was partly oral, partly in writing, but contained no detail as to how the database was to be transferred to Your Response, nor what would happen to it when the contract ended. Indeed, there was no detail as to how and when the contract could be terminated.