Media Room

dedicated, diverse counsel helping you reach your goals

 

Thursday Wrap-Up (May 30, 2013): Noteworthy Trade Secret, Non-Compete and Cybersecurity News from the Web

 
by John Marsh 30. May 2013 11:30
Here are the noteworthy trade secret, non-compete and cybersecurity stories from the past week, as well as one or two that I missed over the past couple of weeks:

Cybersecurity Posts and Articles: 
  • Last week's report from the privately-funded IP Commission has triggered a lot of commentary on the issue of China, cybersecurity, and the international misappropriation of trade secrets. The Economist has chimed in, "Fighting China’s hackers: Is it time to retaliate against cyber-thieves?," The New York Times has offered an Op-Ed "Preventing a U.S.-China Cyberwar," as has Gerry Smith for The Huffington Post, "'Hacking Back' Could Deter Chinese Cyberattacks, Report Says." Lisa Kilday also has a post for The IP Watchdog, as does Sophie Yu for Orrick's Trade Secrets Watch Blog.
  • For a contrarian view of the report and its authors, see TechDirt's article, "Fear Mongering Report Suggests 'IP Theft From China' One Of The Biggest Problems America Faces."
  • "A primer on the keys to a complete cybersecurity incident response plan: Inside counsel that understand cybersecurity become defenders of their companies," advises Daniel Lim for Inside Counsel.
  • "Hackers Find China Is Land of Opportunity," reports Edward Wong for The New York Times.
  • "FTC Fires Back In Cybersecurity Case," reports Brent Kendall for The Wall Street Journal's Law Blog.
  • "FTC Announces Information about Upcoming Mobile Security Forum," advises Mike Nonanka for Covington's Inside Privacy Blog.
  • Rob Radcliff provides his take on BYOD policies in his Smooth Transitions Blog.
  • "Employers Must Obtain Employee Consent For BYOD Programs," recommends Yaron Dori and Jeff Kosseff of Covington & Burling LLP for Law360.
Trade Secrets and Non-Compete Cases, Posts and Articles
  • "Kolon Asks 4th Circ. To Ax $920M DuPont Trade Secrets Award" reports Law360.  In a summary of the oral arguments before the 4th Circuit Court of Appeals, Scott Flaherty reports that Kolon focused on Judge Robert Payne's denial of its motion to recuse himself because of his former firm's involvement in a patent dispute for DuPont and on what Kolon believed was DuPont's failure to provide proof on a trade secret by trade secret basis.
  • "Illinois Appellate Court Partially Reverses Broad Non-Compete Injunction Against Physicians," reports Molly Joyce for Seyfarth Shaw's Trading Secrets Blog.
  • "Customer Lists as Trade Secrets: What Protections Are Sufficient?" asks Eric Ostroff in his Protecting Trade Secrets Blog.
  • Brian Bialas suspects that the recent AMD v. Feldstein decision by the U.S. District Court of Massachusetts may have extended the inevitable disclosure doctrine in Massachusetts. In his post for Foley & Hoag's Massachusetts Noncompete Law Blog, Brian notes the fact that Judge Hillman entered an injunction despite the defendants' protestations that they had already turned over all confidential information to a third-party neutral after the lawsuit was commenced, reasoning that they, "must all remember large amounts of confidential AMD information that they learned during their employment."  (For more on the decision, see my take here).
  • A case out of New York's Fourth Appellate Department suggests that coupling a grant of stock options with a non-compete can be a messy affair if not done right, advises Jonathan Pollard in a recent post for the non-compete blog.
  • "Former Outback Steakhouse Employee Not Necessarily 'Down Under' For Allegedly Breaching Fiduciary Duty" advises Amy Dehnel for Berman Fink & Van Horn's Georgia Non-Compete & Trade Secret News Blog.
  • In "Pennsylvania Appellate Court Orders Sanctions for Plaintiff’s Bad-Faith Trade Secret Misappropriation Claims," Scott Schaeffers examines the recent Kraft v. Downey case for Seyfarth Shaw's Trading Secrets Blog.
  • Rob Radcliff provides his take on BYOD policies in his Smooth Transistions Blog.
  • "Employers Must Obtain Employee Consent For BYOD Programs," recommends Yaron Dori and Jeff Kosseff, Covington & Burling LLP for Law360.
  • "Chinese Trade Secret Theft Hits Universities," reports Press Millen for Womble Carlyle's Trade Secrets Blog.
  • "Non-Compete Agreements Aren’t for Everyone: The Necessity of Proving a 'Legitimate Business Interest,'” advises Betsy Lensan Cook of Womble Carlyle for National Law Review.
  • "Exercise Gym Instructor Enjoined By Non-Compete Agreement," reports David Poppick for Epstein Becker's Trade Secrets & Noncompete Blog.
Computer Fraud and Abuse Act Posts and Cases:
  • "Password Sharing and the Computer Fraud and Abuse Act, Revisited," considers Kenneth Vanko in his Legal Developments in Non-Competition Agreements Blog.
 

Thursday Wrap-Up (May 23, 2013): Noteworthy Trade Secret, Non-Compete and Cybersecurity News from the Web

 
by John Marsh 23. May 2013 11:30

Here are the noteworthy trade secret, non-compete and cybersecurity stories from the past week, as well as one or two that I missed over the past couple of weeks:

Trade Secret and Non-Compete Posts and Articles:

  • A Pennsylvania Court of Appeals has rejected the two-prong test (objective test of speciousness and subjective test for bad faith) used by many federal courts for an award of attorneys fees for a bad faith trade secrets action under the Pennsylvania Uniform Trade Secrets Act reports Law360. In Kraft v. Downey, the Superior Court reversed a trial court's dismissal of a claim for attorneys fees by the defendants, even though the plaintiffs prevailed at trial on other claims. (A hat tip to Mark Grace for forwarding the opinion to me).
  • Ericsonn and Airvana have reached an agreement in principle to settle their trade secrets case, Bloomberg is reporting. Airvana had secured a preliminary injunction in New York Supreme Court that had threatened to disrupt a $3 billion opportunity with Sprint and had resulted in Airvana's claim that Ericsonn had violated the injunction. For more on the case and injunction, see my March post here.
  • For the latest involving the prosecution of Walter Liew for the alleged theft of DuPont's titanium dioxide trade secrets, see "Feds Say Execs Can't Ax DuPont Trade Secrets Charges," as reported by Law360.
  • "Using Computer Forensics to Investigate IP Theft," advise Sid Venkatasen and Elizabeth McBride for Law Technology News.
  • "Kentucky Court Finds No Insurance Coverage for Trade-Secrets Claim," reports Eric Ostroff in his Trade Secrets Law Blog.
  • "Massachusetts Federal Court Takes Jurisdiction Over 'One-Man' Georgia Corporation Whose Agent Allegedly Stole Trade Secrets in Massachusetts," reports Brian Bialas for Foley & Hoag's Massachusetts Noncompete Law Blog.
  • "Recapping the Latest Blue Belt Tech. Non-Compete Dispute (This Time vs. Stryker)," summarizes Jonathan Pollard for the non-compete blog.
  • "Act On Clarifying Ownership of Work-Related Social Media Accounts Before You Become 'Dinner,'" recommends Daniel Schwartz in his Connecticut Employment Law Blog.
  • If you are into podcasts, check out, "The Administration is Focused on Preventing Trade Secrets Misappropriation. Your Business Should Be, Too," by Victoria Cundiff of Paul Hastings.
  • "Proposed Non-Compete Legislation in Connecticut Follows Legislative Trend" advises Kenneth Vanko in his Legal Developments in Non-Competition Blog.
  • If you are interested in more on the $44 million verdict in the Wellogix/Accenture dispute, check out "I Thought We Broke Up Years Ago! Why You Should “Throw Out” Trade Secrets As Soon As A Business Relationship Ends" by Matthew Kugazaki and Valerie Goo for Orrick's Trade Secrets Watch and Eric Ostroff's "A Cautionary Tale About Sharing Trade Secrets With Consultants — Fifth Circuit Affirms $44 Million Verdict."

Cybersecurity Posts and Articles:

  • "California law would require breach notice if online account information is stolen," reports Dan Kaplan for SC Magazine.
  • "Cyber Compliance: Hiring a Cybersecurity IT Firm for Rookies," advises Christopher Matthews for The Wall Street Journal's Risk & Compliance Reporter.
  • "Why CISPA is a global problem," warns TechnoLlama.
  • "Data Breach - Your Organization Needs a Plan" recommends Nicole Reiman of Schnader Harrison Segal & Lewis LLP for JDSupra.
  • "Corporate Security's Weak Link: Click-Happy CEOs: Top Bosses, Exempt From Companywide Rules, Are More Likely to Take Cyber-Attackers' Bait," reports The Wall Street Journal. For more on Spearphishing (or attacks geared towards senior executives better known as whaling, see my post here).
  • "GSA, DOD Solicit Advice On Revamping Cybersecurity," advises Kathryn Brenzel for Law360.

Computer Fraud and Abuse Act Posts and Cases: 

  • "Applying Georgia Long-Arm Statute, Eleventh Circuit Finds No Personal Jurisdiction Based on Internet Activity" in a CFAA dispute, courtesy of Colin Freer for Berman Fink Van Horn's Georgia Non-Compete and Trade Secret News Blog.
 

Thursday Wrap-Up (May 16, 2013): Noteworthy Trade Secret, Non-Compete and Cybersecurity News from the Web

 
by John Marsh 16. May 2013 10:31

Here are the noteworthy trade secret, non-compete and cybersecurity stories from the past week, as well as one or two that I missed over the past couple of weeks:

Trade Secret and Non-Compete Posts and Articles:

  • Bloomberg has received withering criticism for allowing the presumably confidential information of its customers to be viewed (and most likely used) by its reporters. Last week, Bloomberg said it had now restricted its journalists from accessing information about terminal subscribers, including when they last logged on, when they subscribed and how often they accessed features like news or the chat function. CNBC, The New York Times and The Wall Street Journal all have comprehensive articles on the scandal. Bloomberg's troubles underscore the challenges of maintaining ethical screens and walls between business units who have potentially divergent interests over confidential information. 
  • "Credit Suisse says ex VP stole trade secrets in move to Goldman," reports Reuters
  • "5th Circ. Affirms $44M Wellogix Jury Award In Trade Secret Spat," reports Law360.
  • "Trade Secret 'Watch List': Bill Would Establish Monitoring List of Countries Engaging in Cybertheft, and Make U.S. Intelligence Czar the Point Person," reports Robert Isaackson for Orrick's Trade Secrets Watch.
  • "New Massachusetts Superior Court Noncompete Decision Discusses the 'Material Change' Defense and Shows the Benefit to Employers of Having a 'Material Change' Clause in Noncompete Agreements," advises Brian Bialas for Foley & Hoag's Massachusetts Noncompete Law Blog.
  • Josh Durham reports on the latest non-compete involving a doctor, "NC Court of Appeals Orders Injunction In OB-GYN Covenant Not To Compete Case," for Poyner Spruill's Under Lock & Key Blog.
  • And while we are talking about physician non-competes, the recent $39 million "Tuomey verdict could make hospitals more cautious in doctor contracts," advises Adam Kerlin for Reuters.
  • "Florida Court Discusses Trade Secrets in Discovery," reports Solomon Genet for the Trade Secrets Law Blog.
  • "Show Me the Money - Injunctions are Not Cheap," warns Rob Radcliff in his Smooth Transitions Blog.
  • "You Can't Reverse Blue-Pencil a Non-Compete," advises Kenneth Vanko in his Legal Developments in Non-Competition Agreements Blog.
  • "Trade Secrets Law Still Murky in Georgia Courts," reports Alyson Palmer for Corporate Counsel.
  • Fracking and trade secrets remain a combustible combination, as Law 360 reports that, "Enviros Must Show Need To Get Trade Secret Docs: Pa. Court."
  • For an excellent summary of the key points of the new Texas Uniform Trade Secrets Act, see, "Texas Trade Secrets Law Gets Business-Friendly Upgrade," by Jesse Davis for Law360.
  • A recent study finds that over 90% of innovative products are never patented, reports Eric Ostroff in a recent post for his Trade Secrets Law Blog. According to Eric, the study looked at the "R&D 100 Awards" to reach its conclusions. The results of this study of course reinforce the importance of making sure your trade secret protections are adequate.
  • Attention eBay shoppers: "Coca Cola’s secret formula for sale for 15 million dollars," reports DailyBhaskar.com

Cybersecurity Posts and Articles:

  • The theft of nearly $45 billion was from New York banks by cyberthieves was widely reported in the past week. For an analysis of the legal fallout, see, "Lessons From the New York ATM Heist," by Jason Weinsten for Steptoe's Cyberblog.
  • "Legal Showdown on Cybersecurity: Hotelier Wyndham Challenges FTC's Authority to Police Corporate Data Practices," reports The Wall Street Journal.
  • "Cyberattacks Against U.S. Corporations Are on the Rise," reports The New York Times.
  • "'Bring Your Own Device' is Evolving from a Trend to a Requirement," advises Arik Hesseldahl for All Things Digital
  • "Hacking back: Digital revenge is sweet but risky," advises Melissa Riofrio for PCWorld.  

Computer Fraud and Abuse Act Posts and Cases:

  • "No Damages? Illinois Federal Court Tosses Computer Fraud and Abuse Act Claim Alleging Hacking of Law Firm Network," reports Paul Freehling for Seyfarth Shaw's Trading Secrets Blog.
  • "Should Lying About Your Age Online Be a Federal Crime?" asks Peter Torren in an article for Corporate Counsel.
 

Thursday Wrap-Up (May 9, 2013): Noteworthy Trade Secret, Non-Compete and Cybersecurity News from the Web

 
by John Marsh 9. May 2013 06:20

Here are the noteworthy trade secret, non-compete and cybersecurity stories from the past week, as well as one or two that I missed over the past couple of weeks:

Cybersecurity Posts and Articles:

  • Well, it's official: "U.S. Blames China’s Military Directly for Cyberattacks," reports The New York Times. Also see "PENTAGON: Chinese Hackers Have Stolen Data From 'Almost Every Major U.S. Defense Contractor,'" asserts The Business Insider, "Pentagon report says U.S. computer hacking 'appears to be attributable' to Chinese government," reports The Verge and "U.S. Says China's Government, Military Used Cyberespionage," reports The Wall Street Journal.
  • "A cybersecurity primer for legal departments: Understanding the basic terms and concepts needed to protect your company from cyber attacks" by David Lim for Inside Counsel.

Trade Secret and Non-Compete Posts and Articles:

  • Less than two months after its introduction, Texas has adopted the Uniform Trade Secrets Act effective Sept. 1, 2013, reports Orrick's Trade Secrets Watch Blog. It appears that the version adopted is similar to that proposed by Dallas State Senator John Carona and will include a presumption in favor of granting protective orders to protect trade secrets in litigation, including limiting access to confidential information to attorneys and their experts. (For more on the proposed statute, see my post earlier this year as well as Robert Milligan's recent post).
  • Connecticut is joining the list of states tinkering with their non-compete laws, advises Daniel Schwartz in his Connecticut Employment Law Blog.  In "Bill Targets Non-Compete Agreements But Would Also Create New Cause of Action," Daniel reports that the bill allows "reasonable" non-competes but would permit an aggrieved employee the right to sue if the non-compete was unreasonable or the employee was not provided with at least 10 days to consider the non-compete before signing it.
  • "Chinese Couple Sentenced to 3 Years and 1 Year for Theft of GM Hybrid Technology," advises Todd Sullivan in his Trade Secrets Blog.
  • And in another prosecution, "Ex-Frontier Chemist Dodges Prison For Disclosing Recipes," as Law360 reports that the U.S. District Court for Utah sentenced Prabhu Prasad Mohapatra to time served — three days — and ordered him to pay $3,435 in restitution.
  • "Georgia Supreme Court Rejects Independent Claim for Inevitable Disclosure of Trade Secrets," reports Eric Ostroff in his Trade Secrets Law Blog.  Kenneth Vanko has a post on the case as well in his Legal Developoments in Non-Competition Agreements Blog.
  • Eric Ostroff also has a fine post entitled "Five Ways to Protect Trade Secrets When an Employee Departs."  If you have not bookmarked Eric's blog, you should as he is churning out very good content regularly.
  • Those in Pennsylvania should be aware of a decision out of the U.S. Eastern District of Pennsylvania reports the Employee Discrimination Reporter. In De Lage Landen v. Thomasian, the District Court refused to enforce a non-compete despite proof that the former employee had breached a non-solicitation provision by approaching a former colleague. The court reasoned that the parties were not sufficient competitors, there was no showing of future harm, money damages were available, and therefore no irreparable harm was present.
  • "Fracking and Trade Secrets: An Introduction," advises Kenneth Vanko in his Legal Developoments in Non-Competition Agreements Blog.
  • "Fisher/Unitech (Basically) Loses Non-Compete Fight Against Former Sales Exec," advises Jonathan Pollard for the non-compete blog.
  • "Doctor Non-Solicitation Agreement Not Supported By Legitimate Business Interest," reports Zach Jackson for Epstein Becker's Trade Secrets & Noncompete Blog.
  • "Employers Slow To Guard Data Amid Social Media, Tech Boom," bemoans Erin Coe for Law360.
  • "Data Security Policies and Procedures Still Lacking," warns Catherine Dunn for Corporate Counsel.
  • In "Unleashing job hoppers could give economy a bounce," Reynolds Holdings posits in an article for Reuters that releasing unemployed workers from their non-competes might help the economy.
  • "China Non-Competes. The Basics Have Become Clearer," advises Dan Harris in his China Law Blog.

Computer Fraud and Abuse Act Posts and Cases:

  • "California Federal Court Dismisses Computer Fraud and State Unfair Competition Claims Alleged Against Ex-Employees Accused Of Stealing Computer Source Code," reports Paul Freehling for Seyfarth Shaw's Trading Secrets Blog.
  • "Programmer Arrested For Cyberattack On Ex-Employer," reports Law360.
  • "Use a Software Bug to Win Video Poker? That’s a Federal Hacking Case," proclaims Kevin Paulson for Wired.
  • "Who's at Fault for the CFAA Mess? Blame Congress," sighs Brian Bialas for Foley & Hoag's Massachusetts Noncompete Law Blog. Sounds good to me.
 

Thursday Wrap-Up (May 2, 2013): Noteworthy Trade Secret, Non-Compete and Cybersecurity News from the Web

 
by John Marsh 2. May 2013 07:10

Here are the noteworthy trade secret, non-compete and cybersecurity stories from the past week, as well as one or two that I missed over the past couple of weeks:

Trade Secret and Non-Compete Posts and Articles:

  • Good advice from Josh Durham: "Use Covenants Not To Compete To Protect Legitimate Business Interests, Not Just Because You’re Scared Of A Little Competition." In his post for Poyner Spruill's Under Lock & Key Blog, Josh recounts the holding of a recent North Carolina case, Phelps Staffing LLC v. CT Phelps, Inc., in which the court found that a non-compete involving temporary staffing employeees lacked a legitimate business interest to justify the restraint. It is an important reminder to companies to ensure that their non-competes be narrowly tailored to protect interests that actually arise from the former employee's employment.
  • Sergey Aleynikov will stand trial a second time, this time in New York State's Supreme Court, for the alleged theft of Goldman Sachs' trade secrets, reports The Wall Street Journal and Law360. Judge Ronald Zweibel ruled that the state charges were not barred by the dismissal of his federal conviction under the Economic Espionage Act last year by the U.S. Court of Appeals for the Second Circuit. (For more on the Aleynikov saga, see my posts here and here).
  • For more on the Ohio Supreme Court's recent holding that rental payments are trade secret, see Todd Sullivan's take in his Trade Secrets Blog. Todd notes the incongruity in the Court's reasoning that disclosure of the trade secrets would lead to a "poisonous" tenant environment, despite the fact that it noted later in its opinion that the landlord's expert said tenants were incentivized not to share rental information. (My post on the case can be found here).
  • "Pushing Back Against Restrictive Covenants in Physician Agreements" advocates Mark Gisler as he questions whether non-competes violate the American Medical Association's code of ethics.
  • "Illinois Federal Court Issues Preliminary Injunction Prohibiting Use Of Misappropriated Trade Secrets But Rejects Request For Expanded Injunction Based On Alleged “Inevitable Disclosure” reports Paul Frehling for Seyfarth Shaw's Trading Secrets Blog.
  • "Florida Court Reverses Preliminary Injunction on Restrictive Covenant," reports Peter Vilmos for Burr & Forman's Non-Compete Trade Secrets Law Blog.  Eric Ostroff also has a post on the case in his Trade Secrets Law Blog.
  • "When a Restriction on Soliciting "Prospective" Customers Is Unreasonable (and How to Fix It)," recommends Kenneth Vanko in his Legal Developments in Non-Competition Agreements Blog.
  • "Never Bring a Knife to a Gun Fight: One Simple Weapon to Fight Economic Espionage in a Cyberspace World," warns Hayden J. Silver III for Womble Carlyle for The Compass.
  • "Why intellectual property theft is everyone’s problem," remind Texas U.S. Attorneys Sarah Saldana and John M. Bales for The Dallas Morning News.
  • "Does social media change the meaning of “solicitation”? How to prevent ex-employees from using social networks to lure employees or customers" recommends Jon Hyman for Inside Counsel. 
  • "Why Abuse of Discretion Matters to Employers (Non-Compete)," advises Rob Radcliff for his Smooth Transitions Blog.
  • "Trade Secret “Inevitable Disclosure” Doctrine Taking Shape in North Carolina," advises Betsy Cook Lanzen of Womble Carlyle for The National Law Journal.

Cybersecurity Posts and Articles:

  • "Reflections On Recent Cybersecurity Developments," ponder David N. Fagan, John K. Veroneau, Robert Nichols and Kristen E. Eichensehr of Covington & Burling LLP for Law360.
  • "The War On Cybercrime: How Far Can You Go?" posits Gabriel Ramsey, Mark Mermelstein and James Hsaio of Orrick for Corporate Counsel.
  • "Is the Specter of a Cyber Cold War Real?" asks James McGregor for The Atlantic.
  • "Law firm fell victim to phishing scam, precipitating $336K overseas wire transfer, bank suit alleges," reports Debra Cassens Weis for The ABA Journal's Law News Now.
  • "Looking at the Future of Cybersecurity," predicts Sue Reisinger for Corporate Counsel.

Computer Fraud and Abuse Act Posts and Cases:

  • Looking for a post-mortem on the recent CFAA trial of David Nosal? Then check out "In Executive's Trade Secret Prosecution, a Company's Outsized Role," by Vanessa Blum who covered the trial for The Recorder, Venkat Balasubrumani's post in the Technology & Marketing Law Blog and Daniel Joshua Salinas' post for Seyfarth Shaw's Trading Secrets Blog.
  • Earlier this week, The Washington Post ran a front-page story, "As cyberthreats mount, hacker’s conviction underscores criticism of government overreach," detailing the prosecution of hacker Andrew Auernheimer.
  • Similarly, The ABA Journal has drawn attention to efforts to reform the CFAA, in an article "Hacker’s Hell: Many want to narrow the Computer Fraud and Abuse Act," by Stephanie Francis Ward.
 

Thursday Wrap-Up (April 25, 2013): Noteworthy Trade Secret, Non-Compete and Cybersecurity News from the Web

 
by John Marsh 25. April 2013 10:45

Here are the noteworthy trade secret, non-compete and cybersecurity stories from the past week, as well as one or two that I missed over the past couple of weeks:
 
Computer Fraud and Abuse Act Posts and Cases: 

  • In a case that is already at the center of the debate raging over the scope of the CFAA, David Nosal was convicted yesterday on six counts by a San Francisco jury. The Recorder's Vanessa Blum has been following the trial closely and her summary of the verdict and trial can be found here. The Ninth Circuit, in a widely reported en banc opinion last year, dismissed six of the CFAA charges against the former Korn/Ferry International employee on the grounds that the district court had too broadly applied the terms "exceeded authorized access," but prosecutors were able to salvage three of the claims on remand. Not surpisingly, Nosal attorneys are optimistic about their grounds on appeal.
  • "Why Is Congress Trying to Make Our Internet Abuse Laws Worse, Not Better?" ask Profossors Orin Kerr and Lawrence Lessig for The Atlantic.

Trade Secret and Non-Compete Posts and Articles: 

  • "AT&T Ducks $35M Trade Secrets Suit Over Smartphone Tech," reports Law360.
  • "Zynga Rival Fires Back in Trade Secret Suit," reports Max Taves for Corporate Counsel.
  • "Physician Non-Competes Upheld by South Carolina Court of Appeals: Baugh v. Columbia Heart Clinic, P.A.," reports Andy Arnold for the Beat Your Non-Compete Blog.
  • "Employee Data Theft and Corporate Hacking Studies Point to Need for Additional Federal Trade Secrets Legislation," advise Robert Milligan and Jessica Mendelson for Seyfarth Shaw's Trading Secrets Blog.
  • North Carolina "Appeals court calls non-compete agreements 'unconscionable' in local staffing company dispute," reports Chris Bagley for the Triangle Business Journal.
  • "Mass-Mailing To Public Employees Did Not Violate Non-Solicitation Agreement," reports John Paul Nefflen for Burr & Forman's Non-Compete Trade Secrets Law Blog.
  • "Trade Secrets In the Cloud: When Can Cloud Providers Access and Share Your Information?" asks Eric Ostroff in his Trade Secrets Law Blog.
  • Looking for more on the New Jersey statute limiting non-competes for unemployed workers? Then check out Kenneth Vanko's post, "New Jersey Non-Compete Bill Follows Maryland Lead - And Then Takes It a Step Further," as well as Epstein Becker's post.
  • "Google Says IP Law Boutique Must Hand Over Personnel File," reports Law360.
  • "What tech companies can learn from Coca-Cola: Trade secrets can be effective at protecting software code and other related assets," recommend Gregory Novak and Matt Todd for Inside Counsel.
  • "Settlements (Part 3 of 3): Dealing With a Defendant's Bankruptcy in Non-Compete Litigation," advises Kenneth Vanko for his Legal Developments in Non-Competition Agreements.
  • Russell Beck has posted his always outstanding "Issues and Cases in the News for April 2013" on his Fair Competition Blog.

Cybersecurity Posts and Articles:

  • CISPA passed the U.S. House of Representatives last week. For details on the bill and mounting oppositiion from privacy advocates, see Hayley Tsukayama's post for The Washington Post here.
  • Verizon issued its Data Breach Investigations Report for 2013, a fine summary of which can be found here, courtesy of Lucian Constantin for PCWorld.
  • "Law Firms Must Devote More Resources To Data Security," advises Daniel B. Garrie of Law & Forensics LLC for Law360.
  • "Cyber Criminals Have Small Businesses in Their Cross-Hairs," warns Joshua Sophy for Small Business Trends.
 

Thursday Wrap-Up (April 18, 2013): Noteworthy Trade Secret, Non-Compete and Cybersecurity News from the Web

 
by John Marsh 18. April 2013 16:30

Here are the noteworthy trade secret, non-compete and cybersecurity stories from the past week, as well as one or two that I missed over the past couple of weeks:

Trade Secret and Non-Compete Posts and Articles:

  • As many of you know, the Obama Administration has invited public comments on possible federal trade secret legislation by April 22, 2013. Peter Toren has posted his letter and comments to the Administration on his blog and I would commend everyone to review them and to get their own comments to the Administration if they favor a federal trade secret statute. I am hoping to get my letter and comments finished and posted as well by the end of the week.
  • Similarly, in "Obama Administration’s Request for Public Comment on Trade Secrets Law Underscores Importance for Companies to Protect Their Proprietary Assets Now," Robert Milligan has a fine summary on a recent American Bar Association resolution supporting a federal trade secrets civil cause of action in Seyfarth Shaw's Trading Secrets Blog.
  • The dismissal of Macy's breach-of-confidentiality-agreement claim against Martha Stewart Living Omnimedia generated some headlines last week. Bloomberg has a nice summary of the decision, which was issued from the bench.
  • "Dispute Involving 3-D Printers And Covenant Not To Compete Proves That Details Matter," advises Josh Durham for Poyner Spruills' Under Lock & Key Blog.
  • "Devicor, Major Player in Medical Device Industry, Loses Non-Compete Case Against Former Employee," reports Jonathan Pollard for the non-compete blog.
  • "Employees still use online file sharing, even if companies prohibit its use," warns Lucas Mearian for ComputerWorld.
  • "Protecting Trade Secrets: How many shades of gray do you need to count?" asks Neil Wilkoff for IP Finance.
  • "6th Circuit Addresses Reasonable Protection of Trade Secrets," advises Eric Ostroff in his Trade Secrets Law Blog.
  • "Nebraska Court Addresses Meaning of 'Solicitation' in Non-Compete Agreement," reports Ken Wentz for Jackson Lewis' Non-Compete & Trade Secrets Reporter.
  • "Why Courts Like Non-Solicits over Non-Competes," advises Rob Radcliff in his Smooth Transitions Blog.
  • "No-Hire Provisions In Settlement and Commercial Agreements -- Are they Legal?" asks Robert Goldstein for Epstein Becker's Trade Secrets & Non-Compete Blog.
  • "Does the Alabama Trade Secrets Act Limit Remedies for Theft of Information?" asks Gill Egan for Burr & Forman's Non-Compete Trade Secrets Blog.
  • "Settlements (Part 2 of 3): 5 Reasons Non-Compete Cases Should (and Do) Settle," advises Kenneth Vanko in his Legal Developments in Non-Competition Agreements.

Cybersecurity Posts and Articles:

  • In "Civil Liberties Fears Dooms House Cybersecurity Bill," The New York Times Bits Blog reports that President Obama is threatening to veto CISPA because of privacy concerns.
  • "Amendments to CISPA a Threat to Cybersecurity?" asks Stewart Baker in Covington's Cyberblog.
  • "Spending Bill's China Cybersecurity Provision Is Unclear," advises H. Deen Kaplan, Thomas L. McGovern and Harriet P. Pearson, Hogan Lovells LLP for Law360.
  • "King & Spalding Blocks Email Access Amid Security Concerns," reports Beth Winegarner for Law360.

Computer Fraud and Abuse Act Posts and Cases:

  • "Shameful: Tech Companies Fighting Against Necessary CFAA Reform And CISPA Fixes," complains TechCrunch.
  • "Hacking the Law: Fights Over Cyber-Security and a Silicon Valley Divide," reports Rachel Swan for SFWeekly.
  • "Amending the Computer Fraud and Abuse Act," proposes Peter Toren for Bloomberg.
  • For the latest on developments in the U.S. v. Nosal trial, see "Ex-KFI Worker Recounts Trade Secret Theft In Hacking Trial' by Beth Winegarner for Law360 and "Prosecutors Get Key Testimony From Ex-Lover in Hacking Trial," by Vanessa Blum for The Recorder.
 

Thursday Wrap-Up (April 11, 2013): Noteworthy Trade Secret, Non-Compete and Cybersecurity News from the Web

 
by John Marsh 11. April 2013 16:10

Wow, it was a busy week. Here are the noteworthy trade secret, non-compete and cybersecurity stories from the past week, as well as one or two that I missed over the past couple of weeks:

Trade Secret and Non-Compete Posts and Articles:

  • Federal prosecutors were dealt a severe blow in the Economic Espionage Act case brought against affiliates of the Pangang Group (a company with ties to the Chinese government), as U.S. District Court Judge Jeffrey White quashed summons against them in the U.S. v. Liew case.  As reported by Bloomberg and Law360, this is the second time that summons have been quashed and it increasingly appears that the government will not be able to serve, let alone prosecute, these companies for their alleged role in the theft of DuPont's titanium dioxide trade secrets.
  • "New Jersey Legislators Propose Banning Non-Compete Agreements With Employees Who Can Claim Unemployment," reports Jessica Mendelson for Seyfarth Shaw's Trading Secrets Blog. Also see Law360's article, "NJ Bill Targets Noncompete Restrictions On Unemployed."
  • Honey, I stole the trade secrets!  "Can an Employee Use a Spouse to Circumvent Restrictive Covenants? Georgia Court of Appeals Says 'No,'" advises Amy Dehnel for Berman Fink Van Horn's Georgia Non-Compete and Trade Secret News.
  • "Merrill Lynch Says Ex-Advisers Stole Client Info," reports Law360, when they joined competitor Wells Fargo.
  • "Wisconsin Researcher Accused of Economic Spying for China," reports Bloomberg.
  • "Plaintiff’s Foreign Operations Result in 'Lessened' Deference to Choice of Home Forum in Trade Secret Misappropriation Case," advises John C. Law, Ph.D. of McDermott Will & Emery for the National Law Review.
  • "Frisby-Eaton Whistleblower Settles with Frisby, Tolling Agreement Persists with Eaton," advises Alison Grant for The Plain Dealer and Todd Sullivan for his Trade Secrets Blog.
  • "Get Smart About Noncompetes," advises Alan Bush for The Texas Lawyer.
  • Don't forget the importance of "Trade Secrets and Due Diligence," a reminder by Eric Ostroff for his Trade Secrets Law Blog.
  • For a recent non-compete case out of Florida's Fifth District Court of Appeal, see "A Court’s Order Must Comply With The Restrictive Covenant It Seeks To Enforce," by Kain & Associates' ComplexIP.com.
  • "Enforcing a Non-Compete Agreement in Florida: What Evidence is Relevant?" asks Jason Cornell for Fox Rothschild's South Florida Trial Practice Blog.
  • "Non-competes: HR’s version of the Prenup," proclaims Steve Boese for Fistful of Talent.
  • "5 Privacy and Data Security Measures That Can Protect Your Company Against Trade Secret Theft," recommends Lindsey Tonsager for Covington's Inside Privacy Blog.
  • Kenneth Vanko has the first of three posts on why certain non-compete and trade secrets cases may not settle for his Legal Developments in Non-Competition Agreements Blog.
  • And for the litigators, "Don't Forget about E-Discovery When Moving to The Cloud," advises Jay Yurkiw for Porter Wright's Technology Law Source Blog.

Cybersecurity Posts and Articles:

  • As many of you may have noticed last week, The Wall Street Journal launched a Risk & Compliance Reporter that will cover, among other things, developments in cybersecurity.  It is worth bookmarking. To that end, here is one of the introductory posts, "Three Tactics for Cyber defense" by Mark G. Graff.
  • "How To Mitigate The IP Risks Of Data Breaches," advises Carol Anne Been and Andy Blair of Dentons for Law360.
  • In an op-ed piece for The New York Times "Closing the Door on Hackers," Marc Maifret, CTO for BeyondTrust wonders whether software companies are incentivized to allow hacking.
  • "Insider Theft: the Real Cyber Threat?" asks The Wall Street Journal's Corruption Currents Blog.  The post quotes Mike Dubose of Kroll as estimating the average time between an internal breach and its discovery is 32 months.
  • "As more hackers target lawyers, here’s how to protect client data," recommends Rachel Zahorsky for the ABA's Techshow.
  • "U.S. Undersecretary to Discuss Hacking With Chinese Officials," reports Bloomberg.
  • "Silicon Valley Fights Restrictions on Chinese Tech," reports The Wall Street Journal.
  • "A Different Approach To Foiling Hackers? Let Them In, Then Lie To Them," recommends Andy Greenberg for Forbes. (And don't forget to at least buy them a drink).

Computer Fraud & Abuse Act Posts and Cases:

  • The trial in the prosecution of David Nosal is underway in San Francisco and expected to go about 12 days. Here are some of the articles covering it: "In High-Tech Hacking Trial, a Battle of Low-Tech Openings," notes Max Taves, who is covering the Nosal trial, for The Recorder. Also check out Vanessa Blum's article, "Amid Calls for Reform, a Rare Trial of Hacking Law," also for The Recorder.
  • "Here are eight cyber crooks who got less prison time than Andrew Auernheimer," advises Dan Kaplan for SC Magazine.
  • "NY Times Reporter Jenna Wortham Accidentally Reveals How She Violated Both The CFAA & The DMCA," reports Techdirt.
  • "7th Circ. Won't Resurrect Employer Email Hack Suit," reports Law360, as the plaintiff was unable to demonstrate that the alleged invasion of privacy cost him more than $5,000.
 

Friday Wrap-Up (April 5, 2013): Noteworthy Trade Secret, Non-Compete and Cybersecurity News from the Web

 
by John Marsh 5. April 2013 09:40

Here are the noteworthy trade secret, non-compete and cybersecurity stories from the past week, as well as one or two that I missed over the past couple of weeks:

Trade Secret and Non-Compete Posts and Articles:

  • House Intelligence Committee Chairman Mike Rogers (R-MI) has announced that he will be presenting a bill later this year that will penalize foreign countries that sponsor hackers that attempt to steal trade secrets from U.S. companies. In an article for Main Justice, Katy O'Donnell writes that Rogers will be considering some unconventional remedies such as suspension of visas and other tools.
  • "DuPont Wins Kolon Property In $920M Recovery Effort," reports Law360.
  • For the latest on the Eagle v. Morgan social media ownership case, see Jessica Mendelson's post for Seyfarth Shaw's Trading Secrets Blog. As Jessica details, the trial court found that Dr. Eagle's former employer misappropriated her LinkedIn profile but that Dr. Eagle failed to prove her damages.
  • "Live Events Agency Sues Former Employees And Independent Contractor For Breach Of Non-Solicitation Agreements," advises John Paul Nefflen for Burr & Forman's Non-Compete Trade Secrets Blog.
  • "Patterson Atty Gained Secrets Through Ruse, Doc Says," reports Law360. According to the article, the attorney approached a Pennsylvania physician to advise him and then extracted information from the inventor of surgical stapling technologies in order to give a client a leg up in licensing negotiations.
  • "Cease and Desist Letters Enjoy an Absolute Privilege from Libel Claims," advises Kara Maciel for Epstein Becker's Trade Secrets & Non-Compete Blog.
  • "MGA's Trade Secrets Claim On Brink In Bratz Case," reports Law360, as MGA fights upstream to revive its trade secrets claim.
  • "Restaurant Industry Giant Landry’s Sues Former Employee & Rival Restaurant Company," advises Jonathan Pollard in the non-compete blog.
  • "Many U.S. Businesses in China Cite Data Theft," reports Carlos Tejada for The Wall Street Journal's Corruption Currents Blog. According to the survey, 26% of companies with a presence in China have had their trade secrets stolen and 40% see the risks rising.
  • "How New Trade Secret Legislation Impacts Pharma Compliance Programs," reports Fish & Richardson's Jose Sierra for the Pharmaceutical Compliance Monitor.
  • "Practice Tip: Don't Call Your Liquidated Damages Clause a 'Penalty In the Contract," cautions Kenneth Vanko in his Legal Developments in Non-Competition Agreements Blog.
  • For the litigators: "Sanctions For Deleted Facebook Give Employers A Boost," reports Law360. Epstein Becker has a post about the case as well.

Cybersecurity Posts and Articles:

  • In The Wall Street Journal's "Weekend Interview" entitled, "Why China is Reading Your Email," cyber expert Timothy Thomas believes the recent cyber attacks are part of a military strategy and that an offensive strategy may be needed.
  • "Cyberattacks Seem Meant to Destroy, Not Just Disrupt," notes Nicole Petlroth for The New York Times Bits Blog.
  • "New Hacking Study Shows What Good Guys Are Up Against," advises The Wall Street Journal's Digits Blog.

Computer Fraud and Abuse Act Posts and Cases:

  • "Aaron Swartz’s Prosecutors Were Threatened and Hacked, DOJ Says," reports David Kravets for Wired.
  • "Is the Computer Fraud and Abuse Act a Failed Experiment?" asks Brian Bialas in Foley & Hoag's Massachusetts Noncompete Law Blog, in a rejoinder to Eric Goldman's post on the CFAA last week.
 

Friday Wrap-Up (March 22, 2013): Noteworthy Trade Secret, Non-Compete and Cybersecurity News from the Web

 
by John Marsh 22. March 2013 16:30

Here are the noteworthy trade secret, non-compete and cybersecurity stories from the past week, as well as one or two that I missed over the past couple of weeks:

Trade Secret and Non-Compete Posts and Articles:

  • Does a law firm have to reveal its client's non-compete to the client's business partners? In "Texas Firm Beats Fraud Suit For Keeping Mum On Noncompete," Law360 reports that the answer is "no." The Texas Court of Appeals held that there was no duty to disclose the client's non-compete by the law firm and its attorney when they negotiated legal documents with those third parties.
  • "Non-Compete Fight in the World of Surgical Robotics: MAKO Surgical Sues Competitor, Former Employee," advises Jonathan Pollard for the non-compete blog.
  • "FBI arrests NASA contractor employee trying to flee to China," reports The Washington Examiner.
  • "Stryker Exec Who Jumped Ship Must Hand Over Trade Secrets," reports Law360.
  • "Protecting Trade Secrets with a Mobile Workforce and Telecommuters," reports Cliff Atlas for Jackson & Lewis' Non-Compete & Trade Secrets Report.
  • Even The Economist is writing about the importance of trade secrets, asking, "Can you keep a secret? To patent an idea, you must publish it. Many firms prefer secrecy."
  • "Mediating Non-Competes in the Medical Device Industry," explains Michael Greco for Fisher & Phillips' Non-Compete and Trade Secrets Blog.
  • Will the ability to preserve an invention as a trade secret lead patentholders to withhold the best mode of that invention in their patent applications? In "Patent law's 'best mode' requirement a conundrum for attorneys," Erin Geiger Smith warns that could be the case for Bloomberg.
  • "5 ways in-house lawyers can support innovation at their companies: Inside counsel have a duty to help drive innovation to success, within the limits of existing law and policy," advises Eric Esperne in Inside Counsel.
  • Want to enforce a non-compete against a Chinese employee? You need to read, "China Employee Non-Competes. Do Not Try This At Home," by Dan Harris for his China Law Blog.

Cybersecurity Posts and Articles:

  • "After a Data Breach, Do You Need an Investigator or a Lawyer?" asks Catherine Dunn for Corporate Counsel.
  • "Take Chinese Hacking to the WTO," urges James P. Farwell for The National Interest.
  • "Infographic: How Criminals Guess Your PIN," warns Gina Smith for Tech Page One.

Computer Fraud and Abuse Act Posts and Cases:

  • "U.S. v. Nosal: Back In the District Court, the Defendant Isn't as Fortunate," reports Kenneth Vanko in his Legal Developments in Non-Competition Agreements Blog.
  • "The Split in the Circuit Courts Over the Proper Interpretation of the Computer Fraud and Abuse Act Actually Goes Three Ways," updates Brian Bialas for Foley & Hoag's Massachusetts Noncompete Law Blog.
  • Is journalist Matthew Keys the latest Aaron Swartz? asks Garance Burke in his article for The Huffington Post entitled, "Matthew Keys' LA Times Hack: Security Breach Or Harmless Prank?"
  • And in another high profile CFAA prosecution, Orin Kerr writes, "United States v. Auernheimer, and Why I Am Representing Auernheimer Pro Bono on Appeal Before the Third Circuit," for The Volokh Conspiracy.

About John Marsh

John Marsh Hahn Law AttorneyI’m a Columbus, Ohio-based attorney with a national legal practice in trade secret, non-compete, and emergency litigation. Thanks for visiting my blog. I invite you to join in the conversations here by leaving a comment or sending me an email at jmarsh@hahnlaw.com.

Disclaimer

The information in this blog is designed to make you aware of issues you might not have previously considered, but it should not be construed as legal advice, nor solely relied upon in making legal decisions. Statements made on this blog are solely those of the author and do not necessarily reflect the views of Hahn Loeser & Parks LLP. This blog material may be considered attorney advertising under certain rules of professional attorney conduct. Regardless, the hiring of a lawyer is an important decision that should not be based solely upon advertisements.

BlogRoll

Download OPML file OPML