Introduction

In recent years, as competition among enterprises for talent has intensified, disputes over “malicious poaching” have frequently arisen. This is particularly the case in industries such as high-tech and startups that rely on core R&D personnel. When a competitor systematically poaches members of an enterprise’s key team, the target enterprise’s operations and competitive advantages often suffer a significant impact. However, the free movement of talent in the labor market and an enterprise’s recruitment of employees from another company by offering more favorable terms are, respectively, within the scope of the right to work protected under the Constitution and normal means of competition in a free-market economy and are not inherently illegal. Therefore, how to draw a reasonable boundary between protecting employees’ freedom to choose their employment and preventing unfair means of competition has become a core issue in judicial practice.

Taiwan High Court Civil Judgment No. 110-Zhong-Lao-Shang-7 (the “Gogoro Malicious Poaching Case”) is a rare case in Taiwan in which the court made a substantive determination regarding systematic employee poaching between enterprises and awarded damages based on the tort under the latter part of Article 184, paragraph 1 of the Civil Code. This judgment offered judicial views regarding the determination of the boundaries between “poaching” and “malicious poaching,” how to apply the tort liability under the Civil Code, and the determination of the nature of non-poaching clauses, all of which are highly valuable for reference. With the Gogoro case as its major focus, this article examines the views of Taiwanese courts on this issue.

I. Overview of the Gogoro Malicious Poaching Case[1]

The plaintiff in this case was Gogoro Taiwan Limited. The two defendants had previously served as the heads of the plaintiff’s powertrain R&D department and human resources department, respectively. After leaving the company, the two jointly founded LSC Ecosystem Corporation, a company in competition with the plaintiff, and systematically solicited 20 employees from the plaintiff’s R&D department (reaching two-thirds of the department’s workforce) to leave and join the new company. They enticed these employees with attractive salaries, equity interests (in exchange for their technical contributions), and co-founder titles. They also consulted a law firm to formulate a strategic plan for circumventing legal liability, including arranging for some of the employees to temporarily take positions as university researchers to create a break in their career history. Accordingly, the plaintiff filed a lawsuit against the two defendants for joint tort liability pursuant to the latter part of Article 184, paragraph 1 and Article 185 of the Civil Code, and alleged that the two had violated the non-compete and non-poaching clauses in their employment agreements.

The court of the first instance rendered a judgment (Taiwan Taipei District Court Judgment No. 109-Lao-Su-85) dismissing the plaintiff’s claims, primarily on the grounds that the plaintiff had failed to prove the fact that the defendants had engaged in malicious poaching of its employees. However, after the case was appealed to the second instance, the Taiwan High Court reversed the original judgment and found the defendants liable in tort.

The Taiwan High Court first held that the post-employment non-compete clauses at issue were void as they were obviously unfair under Article 247-1 of the Civil Code. Then, the court held that the non-poaching clauses in the agreements were valid as they did not affect the former-employee defendants’ right to work per se and were therefore distinct from the non-compete clauses. The core issue in this case was whether malicious poaching constituted a tort. The court accepted direct evidence, including chat records from the company’s internal messaging software, consistent testimony by relevant former employees during related criminal investigations, and meeting minutes from the law firm documenting a proposed list of employees to be poached and circumvention strategies (creating breaks in career histories). Based on the evidence, the court found that the two defendants indeed jointly and systematically poached a large number of the plaintiff’s core R&D personnel according to a prearranged plan, constituting a joint tort under the latter part of Article 184, paragraph 1 and Article 185 of the Civil Code, and awarded the plaintiff NT$8 million in damages.

II. The Distinction Between “Poaching” and “Malicious Poaching”

In the Gogoro case, the court defined poaching as: “The so-called poaching includes solicitation through instigation, inducement, or other means, causing an employee who originally had no intention of resigning to decide to leave, or strengthening an employee’s determination to leave who already had thoughts of resigning, or providing support to the employee in doing so. The motivations for resignation—such as career planning, family or health factors, or dissatisfaction with the original company—are not necessarily connected.” Under this definition, the term “poaching” merely describes a means of recruitment and is not inherently illegal. In a free-market economy, the movement of talent falls within the scope of legitimate commercial competition.

In other poaching cases, most courts have ultimately found that the conduct at issue did not constitute malicious poaching. For instance, in the Lioneers player-poaching case[2], the court pointed out: “Recruiting players under terms superior to those offered by competitors is not necessarily malicious poaching. Player transfers and recruitment are normal aspects of professional basketball… Offering more attractive terms to increase the likelihood of signing a player is a common method of commercial competition. Unless it involves fraud, coercion, or other means contrary to commercial ethics, such conduct cannot simply be regarded as an unfair competition practice involving malicious poaching.“

Similarly, in the Xu Run Holdings case[3], the court held that merely recommending colleagues at the company for employment elsewhere was insufficient to constitute malicious poaching. In another judgment, the court held that privately sharing employment opportunity information with colleagues before or after resignation did not constitute a violation of the duty of loyalty or the principle of good morals if the individual colleagues could autonomously decide whether to follow the departing employee and there was no systematic encouragement of team members to resign.[4] Another court has also considered the former employees’ motivations for resignation in determining whether malicious poaching occurred: if investigation showed that the employee had resigned due to dissatisfaction with the company’s management system, corporate culture, or working environment, rather than as a direct result of the defendant’s solicitation, the defendant could not be deemed to have engaged in malicious poaching.[5]

As to what conduct may constitute malicious poaching, the court in the Gogoro case stated: “Furthermore, where, for competitive purposes, a person engages in planned and systematic employee poaching in order to diminish the employer’s or former employer’s well-trained workforce or exploits the employer’s or former employer’s good commercial reputation to promote the person’s outstanding personnel as having previously worked for that employer or former employer, such conduct should constitute malicious poaching contrary to good morals.” Characteristics of this type include systematic poaching of a competitor’s entire core R&D team or a specific key department (for example, all managers and officers of a first-level department) en masse within an extremely short time frame.

Additionally, in an insurance broker poaching case, one of the defendants was serving as the chairman and general manager of the insurance brokerage company, yet, while still serving in those positions, he used company meetings to openly encourage its insurance solicitors to change employment, resulting in over 50 insurance solicitors leaving the company en masse after the meeting. The court in that case held that the defendant, as a senior executive, had abused his power to orchestrate the systematic poaching of the company’s team, thereby departing from commercial ethics, and causing damage to the company by deliberate intent in a manner contrary to good morals under the latter part of Article 184, paragraph 1 of the Civil Code.[6]

Summarizing the above judgments, in determining whether malicious poaching occurs, the courts will consider comprehensively whether the conduct involves planned, systematic, and large-scale poaching of employees, with the number of poached employees also being a major consideration. By contrast, offering better terms to poach employees, asking individual colleagues whether they are interested in joining another company, or recruiting employees who resign due to personal factors rather than as a direct result of the solicitation does not, by itself, amount to conduct contrary to orderly competition or commercial ethics and thus does not constitute malicious poaching.

III. Potential Legal Liabilities of Malicious Poaching Under Taiwanese Law, as Revealed by the Gogoro Case

1. Tort Liability: Causing Damage by Deliberate Intent in a Manner Contrary to Good Morals (Latter Part of Article 184, Paragraph 1 of the Civil Code)

In the Gogoro case, the court held that persons engaging in malicious poaching violate the latter part of Article 184, paragraph 1 of the Civil Code: “The latter part of Article 184, paragraph 1 of the Civil Code provides that a person who causes damage to another by deliberate intent in a manner contrary to good morals shall be liable for damages. In a modern, diverse, and industrially and commercially developed society, the so-called ‘contrary to good morals’ not only refers to conduct contrary to ethics and morals, social customs, and recognized values, but also includes maliciously exploiting the fruits of another’s efforts through improper conduct that departs from orderly economic competition and commercial ethics. Therefore, where a worker violates duties of loyalty and non-poaching obligations and, by methods contrary to good morals, maliciously poaches current employees of the employer or former employer, such conduct not only gives rise to liability for non-performance of obligations but also constitutes tort liability for unlawfully infringing upon the employer’s or former employer’s property interests in relation to its human resources. Furthermore, where, for competitive purposes, a person engages in planned and systematic employee poaching in order to diminish the employer’s or former employer’s well-trained workforce or exploits the employer’s or former employer’s good commercial reputation to promote the person’s outstanding personnel as having previously worked for that employer or former employer, such conduct should constitute malicious poaching contrary to good morals.“

2. Joint Tort Liability (Article 185 of the Civil Code)

In the Gogoro case, the two former-employee defendants were held jointly liable in tort: “It is sufficient to hold that the appellees engaged in improper conduct departing from orderly economic competition and commercial ethics to maliciously exploit the fruits of the appellant’s efforts in developing the aforementioned research and design personnel, thereby jointly and unlawfully infringing upon the appellant’s property interests in relation to its human resources by methods contrary to good morals. Therefore, the appellant’s claim that the appellees had jointly and maliciously poached its employees and should be held jointly and severally liable to compensate it for damages pursuant to the latter part of Article 184, paragraph 1 and Article 185 of the Civil Code is found to be justified.”

3. Potential Breach of Contract/Non-Performance of Obligations If the Parties Have Entered into Post-Employment Non-Poaching Clauses

Where an employer and an employee have signed a post-employment non-poaching agreement, a violation of that agreement may give rise to liability for non-performance of obligations. An important question, however, is whether a post-employment non-poaching agreement signed between an employer and an employee is, by nature, a post-employment non-compete agreement under Article 9-1 of the Labor Standards Act. This issue is discussed below.

IV. Non-Poaching Clauses and Non-Compete Clauses Are Distinct in Nature and Their Validity Is Judged Independently

In the Gogoro case, the court held that post-employment non-poaching clauses are not post-employment non-compete agreements: “Article 9-1 of the Labor Standards Act does not define a post-employment non-compete restriction. The former Council of Labor Affairs (now the Ministry of Labor) published a ‘Reference Handbook for Executing Non-Compete Agreements’ on 31 March 2003. The handbook defined a post-employment non-compete restriction as an arrangement under which a business entity, in order to protect its trade secrets or business interests or maintain its competitive advantage, requires a particular person to enter into an agreement with it under which the person may not, for a certain period and within a certain geographical area after leaving, be employed by or operate a business that is identical or similar to that of the business entity. Accordingly, non-poaching clauses prohibiting a worker from instigating, inducing, or soliciting the employer’s current employees to resign do not restrict the worker’s right to work after termination of the employment, and thus do not fall within the scope of ‘non-compete restriction.’ Therefore, the appellees’ defense that the non-poaching clauses at issue also fall within the scope of non-compete agreements is not deemed to be justified.” The court held that non-poaching clauses are distinct from non-compete clauses, that non-poaching clauses are not governed by Article 9-1 of the Labor Standards Act, and that the validity of the two types of clauses is to be judged independently.

Conclusion

Employee poaching itself is a normal commercial activity in a market with free competition and is not inherently illegal. However, if, for competitive purposes, a person poaches a competitor’s core personnel in a planned, systematic manner contrary to commercial ethics, thereby damaging the competitor’s interests in the human resources it has developed, such conduct may constitute an act of causing damage to another by deliberate intent in a manner contrary to good morals under the latter part of Article 184, paragraph 1 of the Civil Code. Depending on the circumstances, it may also give rise to joint tort liability and/or liability for non-performance of obligations. As a side note, legal liabilities related to trade secrets are outside the scope of this article. Nevertheless, those engaging in talent poaching should also consider whether their conduct poses a risk of misappropriating or infringing upon the trade secrets of the target company.

Furthermore, the courts have clearly distinguished the legal nature of non-poaching clauses from that of non-compete clauses, holding that the former do not constitute non-compete agreements governed by Article 9-1 of the Labor Standards Act, and their validity should therefore be judged independently. Consequently, if an enterprise wishes to effectively protect its human resources and competitive interests, in addition to establishing a comprehensive confidentiality system, it should also, depending on the circumstances of each case, enter into appropriate agreements containing non-poaching clauses, confidentiality obligations, and non-compete clauses, thereby establishing a comprehensive legal protection framework.

This article is written by Partner Gary Kuo, Attorney Yi-Kai Chen, and Researcher Yu-Lun Kuo.

If you would like to learn more about laws and regulations and other matters related to this article, please feel free to contact us at gkuo@winklerpartners.com and ychen@winklerpartners.com.

12 October 2026

[1] See Taiwan High Court Civil Judgment No. 110-Zhong-Lao-Shang-7.

[2] See Taiwan Taipei District Court Civil Judgment No. 114-Zhong-Lao-Su-34.

[3] See Taiwan Taichung District Court Civil Judgment No. 111-Zhong-Lao-Su-15.

[4] See Intellectual Property and Commercial Court Civil Judgment No. 113-Min-Zhu-Su-48.

[5] See Taiwan Hsinchu District Court Civil Judgment No. 95-Zhong-Su-21.

[6] See Taiwan Chiayi District Court Civil Judgment No. 105-Zhong-Su-33.