Free for a Fee

One of the primary arguments for enacting the Defend Trade Secrets Act (DTSA) in 2016 was the perceived need for the protection of the trade secrets of U.S. companies abroad.  These issues received significant media attention with the focus far and away on China; by way of example, 60 Minutes cited the Justice Department as saying “the scale of China’s corporate espionage is so vast it constitutes a national security emergency, with China targeting virtually every sector of the U.S. economy, and costing American companies hundreds of billions of dollars in losses — and more than two million jobs.”  A consensus emerged that existing civil trade secret remedies at the state court level were inadequate.  These concerns led to calls for a robust federal statute that would provide a civil remedy empowering federal courts to assert their jurisdiction over parties outside the United States.  An important decision issued by the U.S. District Court for the Northern District of Illinois last year, Motorola Solutions v. Hytera Communications Corp.,  2020 U.S. Dist. LEXIS 35942 (N.D. Ill. Jan. 31, 2020), paved the way for other federal courts over the past year to exercise jurisdiction over international actors and international conduct under the DTSA.  This blog post summarizes these recent decisions.

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Takeaway:  As these cases over the past 18 months illustrate, federal courts are willing to apply the DTSA to foreign parties who have taken actions that further acts of misappropriation.  These decisions are an important first step in furthering the DTSA’s goal of protecting U.S. companies’ trade secrets that are misappropriated abroad.

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The content in this post was found at https://www.lexblog.com/2021/09/27/trade-secrets-without-borders-the-defend-trade-secret-acts-promise-as-an-extra-territorial-statute-finally-comes-to-pass/ Clicking the title link will take you to the source of the post and was not authored by the moderators of freeforafee.com

LexBlog/99 Park Row
Gregory H. Andrews
August 23, 2021

The Illinois General Assembly passed a major bill in May that significantly alters how and when employers can use restrictive covenants with Illinois employees.  Illinois Governor JB Pritzker signed the bill into law on August 13, 2021, and it will go into effect January 1, 2022.

We provided details and analysis on the new law here.

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The content in this post was found at https://www.lexblog.com/2021/08/23/illinois-governor-signs-new-non-compete-bill/ Clicking the title link will take you to the source of the post and was not authored by the moderators of freeforafee.com

IP Watchdog
Peter J. Toren
July 2, 2020

Much has already been written in a relatively short period of time since the Eleventh Circuit decided Compulife Software, Inc. v. Newman, __ F.3d __, 2020 WL 2549505, (11th Cir. May 20, 2020). However, such commentaries have not addressed whether this decision is legally supportable and whether other circuits should follow this decision, which would provide a legal basis for website operators under certain circumstances to pursue unwarranted scraping of their websites. This is particularly important because the Supreme Court is currently considering whether to grant certiorari in a case involving whether website scraping is legal under the Computer Fraud and Abuse Act (CFAA). Depending on the outcome of this matter, website operators may be extremely restricted to prevent scraping under that statute.

The content in this post was found at https://www.ipwatchdog.com/2020/07/02/dubious-decision-eleventh-circuit-finds-scraping-data-public-website-can-constitute-theft-trade-secrets-part/id=123029/ Clicking the title link will take you to the source of the post and was not authored by the moderators of freeforafee.com

Technology & Marketing Law Blog
Venkat Balasubramani
March 8, 2021

This is Part II of a review of recent social media ownership disputes. In Part I, I looked at how the Satanic Temple of Washington could not use the CFAA or ACPA to get its Facebook accounts back. Part II involves a bridal wear business’ (JLM Couture) successful reclaim of its Instagram and other social media accounts. In this case, a New York federal judge granted a preliminary injunction against the defendant, Hayley Paige Gutman, prohibiting her from interfering with plaintiff’s use of the account, which generally gave control over the account to JLM.

[Eric’s comment: if you’re like me and you have no idea who Hayley Paige Gutman is, this Cornell alumni magazine spotlight might help. Also, this Business Insider story provides a chronology of this high-profile and messy dispute, featuring an unfortunately public war of words.]

The big difference between the cases: JLM and Gutman had an agreement that addressed JLM’s right to use Gutman’s name. The agreement, which the parties entered into in 2011 (and which was extended at JLM’s option through 2022), also allowed JLM to register a range of trademarks using Ms. Gutman’s name, had solid work-for-hire language, and included a non-compete. The court’s opening paragraph of the findings of fact tells you how this is likely to go:

In the Contract, Ms. Gutman agreed, inter alia, to perform certain duties and granted Plaintiff certain exclusive rights to use and trademark the name “Hayley Paige” and variations thereof. . . . Ms. Gutman also granted Plaintiff “the exclusive world-wide right and license to use her name ‘Hayley’, ‘Paige’, ‘Hayley Paige Gutman’, ‘Hayley Gutman’, ‘Hayley Paige’ or any derivative thereof ([defined] collectively [as] the ‘Designer’s Name’)” for certain purposes during the stated term of the Contract and for two years thereafter. . . .  Explicitly in exchange “for the assignment to the Company of the Designer’s Name and the Trademarks,” JLM agreed to pay Ms. Gutman as consideration, in addition to her base pay and additional sales volume-related compensation, and for ten years following the termination of her employment with the company, a further percentage of “net revenues derived from the sale of goods under the Designer’s Name and Trademarks based on the Designer’s [N]ame.” . . .  The parties engaged in “rounds of negotiations” over the terms of the Contract, during which Ms. Gutman referenced a “Kenneth Pool example” and asked to “add perpetuity language.” . . .  Ms. Gutman represented to Plaintiff during the negotiations that she had an attorney review the Contract during the negotiations, a statement she now claims was untrue. . . .

Breach of contract:

Trademark infringement:

Non-disparagement:

Irreparable Harm:

This is a great case that covers a lot of ground. The docket is overflowing and worth digging into. The big takeaway of course is that there’s a written agreement between the litigants, which distinguishes this case from other social media ownership cases out there. The agreement isn’t necessarily perfect (no agreement is), but it does a nice job of protecting JLM’s rights. Unfortunately, the agreement appears to be filed under seal, although given the docket’s volume, I can’t say I combed through it carefully. In any event, the court liberally quotes from the agreement and it has many helpful provisions. It’s worth noting that the agreement does not expressly cover the social media accounts in question.

The trademark claim also differentiates this case.

The big question is what happens with the account going forward. Does Ms. Gutman have to assist in its operation, or does she have to just hand it off to JLM? Would the court allow her to post some sort of personal (or agreed-to) message to followers in the event she were to create a separate personal account?

Case citation: JLM Couture v. Gutman, No. 20 CV 10575-LTS-SLC (S.D.N.Y. March 4, 2021)

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The content in this post was found at https://blog.ericgoldman.org/archives/2021/03/social-media-ownership-disputes-part-ii-bridal-wear-company-takes-back-control-of-instagram-account-from-ex-employee.htm Clicking the title link will take you to the source of the post. and was not authored by the moderators of freeforafee.com

Technology & Marketing Law Blog
Venkat Balasubramani
March 6, 2021
This is part 1 of a 2-part series covering social media ownership disputes.

This dispute involves the online accounts of the Satanic Temple of Washington: two Facebook pages, one of which had 17,000 followers, a Twitter account, and a “google account”. (Apparently the Temple was able to recover the latter two, so the dispute is over the Facebook pages.)

Departing members, who were once authorized as administrators, took control of the account. The Temple asserted claims under the CFAA, the cybersquatting statute, as well as under state law. The court finds them all deficient and grants the ex-members’ motion to dismiss (with leave to amend).

In Part II, I’ll recap a case where a claim of ownership succeeded—and contrast it with this case. Stay tuned.

Case citation: United Federation of Churches v. Johnson, 2021 WL 764670 (W.D. Wash. Feb. 26, 2021)

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The content in this post was found at https://blog.ericgoldman.org/archives/2021/03/social-media-ownership-disputes-part-i-the-satanic-temple-of-washington-cant-get-its-facebook-pages-back.htm Clicking the title link will take you to the source of the post. and was not authored by the moderators of freeforafee.com

LexBlog
Robert B. Kornweiss, Raija Horstman & Mark A. Klapow
March 27, 2020

A recent decision by the Federal District Court for the Eastern District of New York reinforces that owners of trade secret computer programs should carefully approach copyright registration in order to maintain both copyright and trade secret protection. This includes being conscious of copyright regulations allowing the partial and redacted registration of computer code with the Copyright Office.

In a recent manifestation of this principle, Capricorn Management Systems accused GEICO of misappropriating Capricorn’s trade secret source code for medical billing software. Last week, the court granted GEICO’s motion for summary judgment, holding that the code was not entitled to trade secret protection, in part because it was registered, unredacted, with the U.S. Copyright Office, and was therefore publicly available.

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The content in this post was found at https://www.lexblog.com/2020/03/27/geico-earns-victory-at-intersection-between-copyright-and-trade-secret-law-covering-source-code/ Clicking the title link will take you to the source of the post. and was not authored by the moderators of freeforafee.com

Technology & Marketing Law Blog
Eric Goldman
Jan. 7, 2020

It’s increasingly hard to find good news in Internet law, so I organized this year’s Internet Law roundup by categories of doom. Trigger warning: you should grab some tissues before proceeding.

Doomed (in a Bad Way)

Doomed: User-Generated Content.

Doomed: Print-on-Demand Services.

Doomed: Online Marketplaces.

Doomed: Internet Access Providers.

Doomed: Cybersecurity.

Doomed: Sex Workers and Sex Trafficking Victims.

Doomed: the CCPA. 

Doomed (in a not-terrible sense)

Doomed: “Must-Carry” Obligations for Publishers Who Aren’t State Actors. 

Doomed: the Roommates.com Section 230 Exception.

Doomed: Cases Against Social Media Services for Terrorist Content.

Doomed: the Liebowitz Copyright Litigation Machine.

Doomed: Politicians Banning Constituents on Social Media. T

Other

Online Political Content and Ads.

hiQ v. LinkedIn.

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The content in this post was found at https://blog.ericgoldman.org/archives/2020/01/top-internet-law-developments-of-2019.htm Clicking the title link will take you to the source of the post. and was not authored by the moderators of freeforafee.com

IP Watchdog
Peter J. Toren
January 21, 2020

In general, a trade secret is any information used in business if the owner has taken reasonable measures to keep such information secret, and the information derives independent economic value, from not being generally known to, and not being readily ascertainable through proper means by the public. Almost every state has adopted some form of the Uniform Trade Secrets Act. In addition, with the enactment of the Defend Trade Secrets Act of 2016 (DTSA), trade secrets are also protected under civil and criminal federal law. See 18 U.S.C. § 1831, et seq. Due to the enactment of this Act and the weakening of patent protection in the United States, trade secrets are becoming an increasingly important means for companies to protect their intellectual property. This article provides a summary of important 2019 trade secret decisions and trends.

The content in this post was found at https://www.ipwatchdog.com/2020/01/21/trade-secrets-review-key-2019-decisions-and-trends-part-i/id=118018/ Clicking the title link will take you to the source of the post. and was not authored by the moderators of freeforafee.com

IP Watchdog
Peter J. Toren
January 26, 2020

Part I of this series covered (1) Food Marketing Institute v. Argus Leader Media, 139  S.Ct. 2356 (2020) in which the Supreme Court held that commercial or financial information that is customarily and actually treated as private by its owner and provided to the government under an assurance of privacy is “confidential” under exemption 4 to the Freedom of Information Act and is therefore shielded from disclosure; (2) trade secret cases dismissed on the statute of limitations; (3) improper acts for unclean hands doctrine must be related to the misappropriation claim; (4) the Department of Justice’s continued and increasing focus on theft of trade secrets involving a Chinese connection; and (5) award of “head start” damages. In Part II, we will look at some additional important 2019 trade secret decisions and trends.

The content in this post was found at https://www.ipwatchdog.com/2020/01/26/review-of-key-2019-trade-secret-decisions-and-trends-part-ii/id=118215/ Clicking the title link will take you to the source of the post. and was not authored by the moderators of freeforafee.com

LexBlog
Thomas Hubert & Jacob Pritt
March 18, 2020

In a high-profile trade secret case, a federal court in Chicago ruled that the federal Defend Trade Secrets Act (DTSA) extends beyond the U.S. and covers actions and damages that occur in other countries.

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The content in this post was found at https://www.lexblog.com/2020/03/18/federal-court-rules-trade-secret-damages-can-extend-beyond-the-u-s-border/ Clicking the title link will take you to the source of the post. and was not authored by the moderators of freeforafee.com