Executive Summary: Key Legal and Evidentiary Issues

• Scope of senior executives’ contractual duty of loyalty under article 2088 C.c.Q., both during employment and for a “reasonable time” after termination, in the absence of express non-competition or non-solicitation clauses.
• Alleged disloyal conduct in secretly incorporating Jaguar Tubulars/Mahat Steel, acquiring mills and diverting business opportunities while holding near-presidential and vice-presidential roles at Pipe & Piling Supplies Ltd. (PPSL).
• Use and possible misuse of confidential information, corporate resources and employee identities (e.g., on visa applications) connected to Mahat Steel’s projects in New York and Michigan.
• Evidence of potential employee poaching and improper recruitment activity, including confidential approaches to a key PPSL sales employee and the involvement of engineer Amit in what was described as a “top secret” Dym-approved project.
• Thresholds for provisional and safeguard relief: urgency, appearance of right, serious or irreparable harm, and balance of convenience applied to non-competition, non-solicitation of staff, and non-solicitation of clients.
• Judicial reluctance to impose broad, de facto non-competition bans via article 2088 C.c.Q. where mills are not yet operational, no concrete client solicitation is shown, and ex-employees retain a right to earn a living through loyal competition.

Background and parties

Pipe & Piling Supplies Ltd. (PPSL) is a long-established Quebec-based steel company, part of the Dym group, operating in the manufacture, distribution and sale of steel pipes and piling in Canada and the United States. A significant part of PPSL’s U.S. activity involves supplying spiral-welded steel products for major infrastructure and construction projects and the group’s operations are closely integrated across borders, relying heavily on senior management for planning, procurement, pricing and business development. Inder and Anshu Bhatia are a father-and-son team who spent decades at PPSL. PPSL alleges that Inder, after more than forty years of service, effectively held a president-level role with near-complete operational and financial control, while Anshu, with roughly twenty-seven years of service, functioned as a vice-president of sales and operations with particular responsibility for the U.S. market. Both allegedly enjoyed unfettered access to PPSL’s confidential, strategic and commercial data. Their employment was terminated on 3 March 2026, after PPSL concluded, following a short internal investigation, that they were setting up a steel mill in New York which would compete directly with PPSL.

The abandoned PPSL U.S. mill project and the birth of Mahat Steel

In 2018 PPSL, acting through Inder and Anshu, examined the possibility of expanding its U.S. presence by acquiring and operating an electric-resistance-welded (ERW) steel pipe mill. This technology differs from the spiral-welding process PPSL uses in Canada. The project was seriously studied with their involvement, including identifying suppliers, possible sites and technical leadership. However, PPSL ultimately decided not to proceed with a U.S. mill in 2018 or thereafter, and no evidence showed that it revived the project. Anshu did not drop the idea. In 2019 he incorporated Jaguar Tubulars Inc. in Delaware, later renamed Mahat Steel Pipe Inc. Jaguar/Mahat then embarked on its own U.S. industrial plan. In July 2022 Jaguar purchased a ten-year-old ERW mill for about USD 10.9 million, aimed at producing pipe that would meet American Petroleum Institute (API) standards for the U.S. oil and gas sector. The equipment was sent to Korea for renovation over several years and, as of the dates of the decisions, had never been used in active production. Construction has not yet begun on the facility in Livingston, New York that is intended to house this mill; Anshu estimates that, once construction starts, 18 to 24 months would be needed to make the facility operational. In the summer of 2025, by then operating under the name Mahat Steel, Anshu acquired a used spiral-weld mill in Dearborn, Michigan (the “Detroit mill”), a technology similar to PPSL’s Canadian operations. In a sworn declaration of 9 March 2026 he stated that this Detroit mill would focus on producing “Melted and Moulded” (M&M) steel for U.S. federally funded projects governed by “Buy America” rules. PPSL has no manufacturing capacity in the United States and any steel it supplies into that segment must be sourced from third parties. According to Anshu, the Detroit mill would therefore not materially curtail PPSL’s U.S. business. As of early March 2026, Anshu also stated the Detroit mill could not manufacture for at least another eight weeks.

Discovery of alleged disloyal conduct and the first round of injunction proceedings

PPSL’s suspicions were triggered by a supplier’s denunciation in mid-February 2026. An internal investigation was launched into the Bhatias’ activities and uncovered the Jaguar/Mahat structure, the acquisition and refurbishment of the ERW mill, the purchase of land in New York, and the Detroit spiral-weld mill. PPSL concluded that these steps had been taken covertly while Inder and Anshu still held very senior posts and were exploiting knowledge and opportunities arising from PPSL’s abandoned ERW project. PPSL also alleged more troubling conduct: that Anshu had recruited engineer Kumar Amit, initially sourced for PPSL’s ERW initiative, into the Mahat Steel project while falsely telling him it was a “top secret” initiative known to and approved by Dym; that Amit’s name had been used on U.S. immigration paperwork as an “Operations Manager” of Mahat without his informed consent; and that visa forms suggested Mahat had supplied piles to large infrastructure projects (such as the JFK airport expansion) where, in reality, PPSL and the Dym group had provided the products at a time when Mahat had no operations. PPSL terminated the Bhatias on 3 March 2026 and, on or about 5–6 March 2026, filed an originating application in injunction with requests for permanent, interlocutory and immediate provisional relief. At the provisional stage Justice Bundaru heard the matter on 10 and 12 March and issued judgment on 17 March 2026. PPSL initially sought broad orders, including the appointment of an IT expert to copy the content of devices, applications and email accounts used by the Bhatias and a blanket prohibition on use of PPSL’s confidential information.

Provisional judgment: partial success for PPSL

During the provisional hearing the parties reached a partial accommodation regarding information-related measures. PPSL withdrew several provisional conclusions in exchange for formal undertakings by the Bhatias, which the Court recorded in its order. Inder and Anshu undertook not to use for their personal benefit or for Mahat’s benefit, nor to disclose to others, any documents in their possession as a result of their employment that contain non-public PPSL information, particularly relating to business, products, pricing, costing, manufacturing processes, margins, budgets, reports, contracts or private correspondence. They also undertook to complete agreed steps with respect to PPSL-owned mobile devices and to instruct an approved IT expert to retrieve and preserve the content (up to 3 March 2026) of specified Mahat-related email accounts. The real dispute at this provisional stage lay in the non-competition and non-solicitation measures sought. PPSL asked the Court to prohibit: any involvement by the Bhatias in Mahat (especially in the U.S. mill projects), any participation in the manufacture, distribution or sale of steel pipes and piling anywhere in Canada and the United States, solicitation of PPSL’s and the Dym group’s clients, and solicitation of PPSL’s and Dym group employees. Justice Bundaru accepted that PPSL’s case, grounded in article 2088 C.c.Q., raised a serious issue. The duty of loyalty does not automatically bar post-employment competition, but it does forbid disloyal competition and can, in certain circumstances, justify limits on competitive activity where that activity is inseparable from prior breaches. He relied on Court of Appeal authorities such as Sahlaoui, Bélisle and others, particularly regarding the heightened expectations for very senior executives. Nonetheless, the Court distinguished between the urgent risk of employee poaching and the more remote risk of substantive competition where Mahat lacked any operational mill. On the limited evidentiary record, the Court found a reasonable fear that the Bhatias might solicit PPSL or Dym group staff—reinforced by Anshu’s alleged confidential approach to a key sales employee during his suspension and his earlier covert enlistment of Amit into the Mahat project. The Court therefore ordered that, for ten days, Anshu and Inder must cease and refrain from soliciting employees of PPSL and of specified Dym group companies with a view to enticing or persuading them to resign or alter their employment relationships. Justice Bundaru declined, however, to grant broad non-competition or client-non-solicitation orders on a provisional basis. The ERW mill sat in storage in Buffalo, the New York site was vacant, and Anshu’s own evidence was that the Detroit mill would need at least two months to start production. Without an operational mill, there was no imminent serious or irreparable harm from competition over the ten-day window. The Court emphasized that refusing such broad provisional restraints neither legitimized nor endorsed the Bhatias’ conduct; rather, their decision to continue investing in Mahat carried the risk that later stages of the litigation could result in stricter orders once fuller evidence was available. The post-employment duty of loyalty, the Court noted, runs only for a “reasonable time,” which begins once ex-employees start respecting their obligations.

Renewed proceedings: PPSL’s safeguard application

On 30 March 2026 PPSL returned to court before Justice Davis seeking a safeguard order for forty-five days, effectively attempting to extend and significantly broaden the earlier provisional relief. The core conclusions sought were that Inder and Anshu be ordered to cease any involvement, directly or indirectly, with Mahat Steel and its operations, including the mills planned in Dearborn, Michigan and Livingston, New York, and that they be barred from employment with or rendering services to any entity involved in the manufacture, sale or distribution of steel pipe and piling anywhere in Canada and the United States. PPSL argued that “new facts” emerged after the Bundaru judgment, primarily related to the Detroit mill. Having learned more from Anshu’s 9 March declaration, PPSL engaged investigators. They found that two welders were associated with the Detroit mill, a systems engineer had joined Mahat in December 2025 and was recruiting more engineers, and at least two Indian nationals had been hired for the mill, with recruitment activity allegedly dating back to 2024 while Anshu was still employed by PPSL. A PPSL employee’s name had reportedly been used in immigration applications. Surveillance from 23–26 March showed Anshu and Inder present each day at the Detroit site, apparently meeting engineers, with at least one welder present. A vehicle registered to an individual described online as an “independent wholesale professional” with apparent steel industry connections was observed at the site. PPSL contended these facts showed the Detroit mill was closer to production than previously thought and that the Bhatias were advancing a “projet concurrentiel” in breach of their ongoing duty of loyalty.

The defendants’ explanation and competing legal principles

On 26 March 2026 Anshu provided a new solemn declaration further explaining the Detroit mill. He reiterated that the “small” mill in Detroit—“small” referring to the mill, not the building—was not yet operational and was aimed at producing M&M USA steel for federally funded projects, a market he described as an insignificant slice of PPSL’s U.S. activities where PPSL operates merely as a middleman re-selling U.S.-made products. He stressed that Mahat’s Detroit venture would manufacture only a single in-house product (spiral-welded steel pipe) with an expected capacity of 10,000 tons per year, about one-tenth of PPSL’s capacity, in a narrower size range (8″–24″ outer diameter), and that it would not bundle third-party products as PPSL does. In his view, this would minimally affect PPSL’s U.S. sales. Justice Davis revisited Justice Bundaru’s reasoning but focused on the distinct question now posed: whether PPSL had an apparent right, at this stage, to prevent the Bhatias from continuing any involvement with Mahat or with any steel pipe and piling business across North America, given the absence of contractual restrictive covenants. Drawing on Sahlaoui and Gutin, the Court reiterated that article 2088 C.c.Q. is not the equivalent of a non-competition clause: it preserves the ex-employee’s right to earn a living and to engage in loyal competition after a reasonable period, typically a few months and rarely more than three or four, subject to case-specific circumstances. Justice Davis acknowledged that Anshu had, at times, engaged in questionable conduct, including the use of a PPSL employee’s name in connection with his own venture, but found no clear indication at this point that those acts were done deliberately to harm PPSL. The issue that truly merited scrutiny was whether Anshu had appropriated U.S. opportunities in New York and Detroit for his own benefit while still employed. On the existing record, the Court found this had not been established, though more complete evidence at trial might alter that assessment.

Denial of the safeguard order

Justice Davis analyzed PPSL’s safeguard application through the usual lenses: serious issue, balance of convenience, irreparable harm and urgency. While Justice Bundaru had identified a serious issue around possible disloyal employee solicitation, the new demand sought much broader restraints: complete disengagement from Mahat and a functional ban on working anywhere in the North American steel pipe and piling sector. The Court held that PPSL’s right to that level of relief was “far from apparent.” Justice Bundaru had declined to impose similar restrictions at the provisional stage, and he had left unresolved the exact scope and intensity of the Bhatias’ post-contractual duty of loyalty. Justice Davis stressed that any restriction flowing from article 2088 must be limited in time and geography and that PPSL’s evidence did not show where it sells products in the U.S., what its Delaware entities actually do, or that it meaningfully trades in M&M steel. PPSL’s assumption that any spiral-weld production at Detroit would be inherently competitive with it was said to conflict with Court of Appeal authority confirming that, absent a non-competition clause, ex-employees are in principle free to compete vigorously so long as their conduct remains loyal and in good faith. The alleged “new facts” did not meaningfully shift the factual landscape from what Justice Bundaru had before him. The presence of welders and engineers and the Bhatias’ site visits did not prove imminent production. By contrast, Anshu had put forward new, uncontradicted evidence suggesting that Detroit’s eventual output would overlap minimally with PPSL’s market and might even represent a potential supply source for PPSL. In terms of the status quo, the Bhatias agreed to renew the orders and undertakings from the Bundaru judgment until the interlocutory stage, including the non-solicitation of employees and the confidentiality protections. Against that background, Justice Davis held that the balance of convenience strongly favoured allowing the Bhatias to continue developing the Detroit mill. There was no cogent proof of disloyal conduct such as using PPSL’s confidential information to solicit its clients, and absent such proof they retained the right to compete and to earn their livelihoods. PPSL failed to show irreparable harm: if Mahat were later found to have disloyally solicited PPSL’s clients during or after the Bhatias’ employment, and if PPSL proved lost sales, damages could be claimed. Nor was there urgency: the best evidence remained that Detroit would not be in production for at least five to six more weeks, and there was little indication that the mill’s initial output would be sold to existing PPSL clients.

Overall outcome, successful parties and monetary consequences

Taken together, the two interlocutory decisions reflect a carefully calibrated judicial response to a sensitive employment-competition dispute. In the first, provisional judgment PPSL achieved a partial victory: it secured binding undertakings protecting its confidential information and data, and obtained a short, ten-day non-solicitation order preventing Anshu and Inder Bhatia from approaching PPSL and Dym group employees, with costs of that provisional application awarded against the defendants. In the later safeguard judgment, however, the momentum shifted. PPSL’s attempt to expand those interim restraints into a wide-ranging, de facto non-competition ban across North America was rejected. Justice Davis dismissed PPSL’s application for a safeguard order, reaffirming the Bhatias’ right to earn a living through loyal competition and ordering judicial costs against PPSL. As a result, PPSL and the Bhatias each see mixed interim outcomes: PPSL succeeded to a limited extent at the provisional stage, while the defendants were the successful parties on the safeguard motion. Neither judgment awards quantified damages, and both refer only to costs in generic terms (“with costs” or “with judicial costs”) without stating any dollar figures. On the information available from these decisions, the total monetary amount ultimately ordered in favour of the successful parties—whether as costs, damages or other monetary relief—cannot be determined.