WHAT appears to be months of industrial espionage in the private hospital sector has come to the fore in the Cape High Court in the form of a R10-million lawsuit.

Melomed Hospital Holdings is suing Rondebosch Medical Centre for approximately R10-million for allegedly stealing confidential documents and intellectual property pertaining to patients' billing procedures.

Rondebosch Medical Centre - which is one of Melomed's direct competitors - is expected to file papers today in response to a damages claim that was instituted on November 21.

In a separate court application on November 7, Melomed was granted an order to immediately search for and retrieve "all documents and information" on the premises of the Rondebosch Centre with the help of the sheriff, supervising attorney and independent forensic investigators.

Melomed was also granted an urgent interim interdict barring its competitor from using, copying or distributing any of its intellectual property.

Melomed, an entirely black-owned company, has three hospitals. Its flagship hospital in Gatesville has been operating since 1989, while Rondebosch, which is also entirely black-owned, opened its doors in September.

At the centre of the drama is Melomed billings clerk Zaeem Adam, who admitted to e-mailing Rondebosch's administrator, Natalie Ackerman, information including a "step-by-step guide" on how to bill patients for certain medical conditions and copies of patients' accounts.

In an affidavit, he said he had known Ackerman since 2001. "At the moment, however, I am more in contact with Ms Ackerman's husband, Keith Ackerman, in that he supplies me with toilet paper and household detergents."

He also said he was contacted by one of the directors of Rondebosch, Dr Ismail Shreef, to obtain further information. Shreef, Adam said, is his maternal aunt's brother-in-law. "I know that it was wrong to divulge the private information of Melomed and Melomed's patients to any third party," he said.

Melomed CEO Ridwaan Allie said they discovered what Adam had done by chance. Another employee had sent confidential Melomed financial information to its chief finance director but he had copied the e-mail to a Rondebosch Centre address.

This sparked an internal investigation by Melomed's IT department. It emerged that certain employees had sent e-mails to its competitor.

Allie mentioned that several of his staff members left to join Rondebosch Medical Centre. During the IT probe it was found that Adam had sent several e-mails to Rondebosch. Allie said the methodologies in relation to billing tariffs and procedures had taken more than 20 years of "information and experience to arrive at".

"[Rondebosch] is seeking to 'take a short-cut' in setting up its infrastructure by using [our] billing tariffs and billing procedures as a framework of reference against which it can formulate its own tariffs and procedures," Allie said.

They were "extremely anxious" to recover confidential patient information. Rondebosch could not be reached for comment.