Alarm bells sounded for a Kiwi architecture firm when it discovered one of its departing senior employees downloading thousands of intellectual property files on to a memory stick, a court has heard.
Michael Christopher Davies, 46, is accused of the rare crime of stealing trade secrets from his former employer Context Architects as he left for another firm.
He allegedly took the Context Architects' annual business plan, project files, pricing models which included agreements with Housing New Zealand (HNZ), its ArchiCAD computer drawing template, and project plans for school developments.
The English-born architect faces nine charges of stealing trade secrets for a pecuniary advantage in the Auckland District Court.
Davies' alleged offences came during his last months at Context Architects between September 2016 and March 2017, the court heard.
Operating nationally with offices in Auckland and Christchurch, Context Architects has been involved in several high-profile projects such the redevelopment of Air New Zealand's head office building in central Auckland, according to the firm's website.
Founding director of Context Architects Lisa Hinton told the court her business is considered one of the top 10 Kiwi firms and employs about 77 staff.
About 50 per cent of its business was social housing and large residential developments, she said, while the firm also engaged in hotel and tourism projects.
With more than two decades of experience working on commercial, residential, hospitality, civic and naval architecture projects, Davies was an ideal employee.
"Michael came in as a project architect," Hinton said.
"He was a very good architect."
Davies later became one of the leaders of the firm when he was appointed a principal architect in July 2016.
However, towards the end of 2016 and start of 2017, he engaged in talks to head another practice, Design Partners, the court heard.
"As he left he took numerous documents - thousands of documents isn't overstating it," Crown prosecutor Sam McMullan told the jury during his opening address.
Intellectual property such as working design files and the ArchiCAD template was stolen, McMullan alleged.
However, Davies was downloading such a large volume of documents on to a USB drive that it had alerted the firm's digital security computer system, McMullan said.
During a single day Davies downloaded some 1600 files, the court heard.
"We don't know precisely how many files Mr Davies took," McMullan said.
"We don't know if he took 10 files at a time or emailed other files to his Gmail account, we just don't know."
Context Architects' clients included schools and Housing New Zealand (HNZ), with some of the allegedly stolen documents including details of contract negotiations with the Government agency.
This would allow Davies to "undercut" Context Architects' contract with potentially a better deal for HNZ, McMullan said.
At the time, Design Partners was conducting land and building development work for HNZ, the court heard.
"Michael hadn't worked on any of the Housing New Zealand projects," Hinton said.
Davies also allegedly stole the file for the Highland View apartments project.
The Albany development was designed as a higher-density residential complex with about 170 units in five blocks of between four and six storeys.
After discovering the alleged file removal, Context Architects' board advised the company to go to the police over what was described as someone "stealing the Colonel's secret recipe", the court heard.
It led to search warrants on Davies' home and Design Partners in October 2017.
The board also requested a cease and desist letter be sent to Design Partners to halt any use of the allegedly stolen material when the case went public with a Herald story.
Hinton told the court the letter was sent because it would be "almost impossible to retrieve the files" from their competitors.
"We've never had such a large data theft before," she said.
McMullan also said Davies had acknowledged he took the files.
"I downloaded them all for a reason … I know I wasn't supposed to. I guess where does it go from here?" Davies told the case's lead detective, the court heard.
However, Davies' defence counsel Guyon Foley said while it was correct his client had taken files for projects he worked on he "didn't take the files because he was a crook and didn't think what he was taking was a trade secret".
"The defence says they probably weren't [trade secrets]," Foley said.
"He didn't take the files to make himself or anyone else money."
Foley said the investigation by Context Architects and police was superficial.
"The defence says this case shouldn't even be here," the defence lawyer said.
"This case is a civil case or an employment case at best."
The trial, with Judge Eddie Paul presiding, is expected to last two weeks.