In a long-awaited decision, the Supreme Court resolved a circuit split about whether an individual with access to a computer system violates the Computer Fraud and Abuse Act (“CFAA”) by accessing information for an improper purpose. By a 6-3 decision authored by Justice Barrett, the Court held that an individual does not “exceed authorized access” within the meaning of the CFAA by misusing access to obtain information that is otherwise available to that person. While the case heard by the high court was a criminal case involving a former law enforcement officer’s criminal conviction, the decision nonetheless has broad ramifications for trade secrets and restrictive covenant litigation, as CFAA claims were often brought against employees who misused access rights to misappropriate information. The CFAA is a criminal statute that also provides a civil remedy, and CFAA claims were commonly raised to acquire federal subject matter jurisdiction, especially prior to the enactment of the Defend Trade Secrets Act in 2016, which provided an independent private cause of action in federal court for trade secret misappropriation.
Continue Reading Supreme Court Resolves Circuit Split on Access Under Computer Fraud and Abuse Act

Legal analytics powerhouse Lex Machina recently released its 2020 Trade Secret Litigation Report, which highlights federal litigation trends in the last decade, as well as the last year specifically. While it’s very much an open question whether these trends will continue in light of the COVID-19 pandemic (more on that in our next  post), the report identifies some interesting data. In addition to some of the highlights contained in the official report, a deep dive of Lex Machina’s case repository reveals even more granular trends, demonstrating the wealth of information that can be gleaned and theories that can be tested from the data compiled from the more than 1.7 million federal cases in Lex Machina’s database. In fact, we have to admit that many of our own assumptions were turned upside down upon digging into the voluminous data available on the Lex Machina website! Expect to see a guest post from Lex Machina soon explaining how this data is sourced and what subscribers can do with it.

Some of the key findings in the report and/or associated data:
Continue Reading A Decade of Data Whets the Appetite for Data Nerds: Lex Machina Releases 2020 Report on Trade Secret Litigation

Please join us for a one-hour CLE webinar on Wednesday, November 14, 2018, at 1:00 p.m. Eastern / 12:00 p.m. Central / 10:00 a.m. Pacific.

Trade secret misappropriation is increasingly gaining the attention of law enforcement authorities. This reality creates different dynamics and risks depending on whether a company is being accused of wrongdoing or is the victim of such
Continue Reading Upcoming Webinar! Criminal Trade Secret Theft Update

In what appears to be a first under the Defend Trade Secrets Act (“DTSA”), a United States District Judge has thrown out claims against an alleged trade secret thief on the basis of the DTSA’s immunity for confidential disclosures to attorneys in the course of investigating a suspected violation of the law. Christian v. Lannett Co., Inc., No. 16-cv-00963-CDJ, 2018 WL 1532849 (E.D. Pa. Mar. 29, 2018).

Certain Trade Secret Disclosures to Attorneys or the Government Are Protected

The DTSA exempts from both criminal and civil liability any trade secret disclosure made in confidence to a federal, state, or local official or to an attorney if the disclosure is made “solely for the purpose of reporting or investigating a suspected violation of law.” 18 U.S.C. § 1833(b)(1).
Continue Reading Defend Trade Secrets Act First: Claim Tossed Based on Whistleblower Immunity

Continuing our annual tradition, we present the top developments/headlines for 2017/2018 in trade secret, computer fraud, and non-compete law.

1. Notable Defend Trade Secrets Act Developments

Just two years after its enactment, the Defend Trade Secrets Act (“DTSA”) continues to be one of the most significant and closely followed developments in trade secret law. The statute provides for a federal civil cause of action for trade secret theft, protections for whistleblowers, and new remedies (e.g., ex parte seizure of property), that were not previously available under state trade secret laws.
Continue Reading Top Developments/Headlines in Trade Secret, Computer Fraud, and Non-Compete Law in 2017/2018

Robert B. Milligan, Partner and Co-Chair of Seyfarth’s National Trade Secret, Computer Fraud, and Non-Compete practice group, just finished co-editing and co-authoring a prominent new California trade secret treatise.

This Supplement to the Third Edition practice guide addresses the Defend Trade Secrets Act (DTSA ), which was enacted in 2016.  This Supplement includes additional practical tips and strategies related to
Continue Reading Seyfarth’s Robert Milligan Co-Edits and Co-Authors New Treatise on Defend Trade Secrets Act

On Tuesday, October 10, 2017, the United States Supreme Court denied certiorari in Nosal v. United States, 16-1344. Nosal asked the Court to determine whether a person violates the Computer Fraud and Abuse Act’s prohibition of accessing a computer “without authorization” when using someone else’s credentials (with that other user’s permission) after the owner of the computer expressly revoked the first person’s own access rights. In denying certiorari, the Court effectively killed the petitioner’s legal challenge to his conviction in a long-running case that we have extensively covered here, here, here, here, here, here, and here (among other places). The denial of certiorari leaves further development of the scope of the CFAA in the hands of the lower courts.
Continue Reading Supreme Court Refuses to Hear Password-Sharing Case, Leaving Scope of Criminal Liability Under Computer Fraud and Abuse Act Unclear

shutterstock_533123590Continuing our annual tradition, we present the top developments/headlines for 2016 in trade secret, computer fraud, and non-compete law. Please join us for our first webinar of the New Year on February 2, 2017, at 12:00 p.m. Central, where we will discuss these new developments, their potential implications, and our predictions for 2017.

1. Defend Trade Secrets Act

One of
Continue Reading Top Developments/Headlines in Trade Secret, Computer Fraud, and Non-Compete Law in 2016

shutterstock_361749602The Computer Fraud and Abuse Act (“CFAA”) gives rise to an actionable claim if someone “knowingly access[es] a computer without authorization or exceed[s] authorized access.” 18 U.S.C. § 1030(a)(1). The term “exceeds authorized access” is defined as “to access a computer with authorization and to use such access to obtain or alter information in the computer that the accesser is
Continue Reading What Underlying Facts are Required to Assert a Valid CFAA Claim Based on “Exceeds Authorized Access” in Georgia?