Petronet Lng Ltd vs Indian Petro Group And Another on 13 April, 2009 offence punishable with ten years imprisonment or fine up to Rs.25 crores or both. Further, under Section 21 of the Securities contract (Regulation) Act, 1956 {"Securities Act"), a company whose securities are listed on a recognized stock exchange has to comply with the listing Agreement of that stock exchange. Under the Listing Agreements that the plaintiff had entered into with the Bombay Stock Exchange and the National Stock Exchange, (where the plaintiff's securities are listed) there is an obligation on its part, to inform the respective stock exchanges of any significant business plans such as undertaking of new projects, new investments etc., before such information is CS(OS) No.1102/2006 Page 8 disclosed to the general public and non compliance is an offence punishable with ten years' imprisonment or fine up to Rs.25 crores or both. 8. The information in the news item reproduced in paragraph 5 A(ii) above, says the plaintiff, pertains to confidential negotiations between the plaintiff and certain Exxon Mobil companies which are covered by a Confidentiality agreement, in terms of which a party cannot make, or cause to be made any statement to a third party, the public or media regarding the occurrence or the substance of any communications, discussions or negotiations without the prior agreement in writing of others. Parties cannot even use or permit use of the name of the others or any of their affiliates in any publication, advertisement or other disclosure. The unauthorized publication of this offending news item by the defendants has the potential of being treated by the other parties to the confidentiality Agreement as a material breach committed by the plaintiff resulting in the other party's potential suspending on-going negotiations or altogether walking out of the negotiations. The consequence of this would be disastrous for the plaintiff both in terms of loss of business and loss of reputation. The plaintiff claims to have suffered embarrassment and the threat of potential default due to the unauthorized publication of the offending news items. It is alleged that Exxon Mobil companies have viewed it as a breach of the confidentiality agreement by the plaintiff and sought its explanation, which has been given. However, such embarrassment could have been well avoided if the defendants had acted with some sense of responsibility. The plaintiff is not in a position to give the details or produce documents in this regard as it claims to be bound by the confidentiality clauses; it undertakes to produce it for the perusal of this Court if and when directed to do so. It is contended that there are media reports that for a significant amount of the LNG that the plaintiff is presently negotiating, the seller has been in parallel negotiations with LNG buyers in China, Korea and Japan. In such situations unauthorized disclosure and publication of critical information relating to price, quantity, etc., of the plaintiff's ongoing negotiations with the LNG sellers gives its competitors an unfair advantage as they are at all times aware of confidential information. The disclosure of such information can mean that the plaintiff and in turn other oil and gas industry stakeholders may lose their share of LNG which would result in adverse impact on gas and energy consumers. CS(OS) No.1102/2006 Page 9 9. The news item reproduced in paragraph 5-A (iii) above which states that the plaintiff has selected ship owners, to be issued bid documents is incorrect, according to the plaintiff. The time charter contract to be awarded is of significant commercial value. Hence, the matter of selection of ship-owners is highly confidential and a closely guarded secret till the plaintiff's board of directors decides this finally, based on an evaluation of the recommendations of a committee appointed by it. Indian Kanoon - http://indiankanoon.org/doc/8534067/ 7