The big baseball news relates to the St. Louis Cardinals hacking of the Astros scouting database and not the latest deal for a high priced middle reliever.  As a data breach attorney and baseball fan, it is rare that two of my main interests collide.  I must confess to feeling some schadenfreude since I am a long suffering Brewers fan.

The New York Times has been all over this, reporting that the Cardinals had an acrimonious breakup with former GM Jeff Luhnow.  The hack was initiated by current Cardinals employees with an apparent ax to grind with Luhnow.  The motivation appears to have been to embarrass Luhnow by exposing his private conversations about talent.

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Previously, we explored the merits of the summary judgment as a responsive pleading to a Complaint in trademark and copyright lawsuits.  Let’s look at the other side of the coin.  Why would you not file a summary judgment and instead opt for a rule 12b6 motion?  I think the main reason is if you have a client that is reticent about discovery.  However, even if that is the case, I could argue summary judgment is the way to go because a rule 56d request is tough and the plaintiff does not have a lot of time to put together such a motion.

Rule 56d provides in part that “if the non-moving party shows by declaration that, for specified reasons, it cannot present facts essential to justify its opposition, the court may: defer considering the motion or deny it; allow time to take discovery; or issue any other appropriate order.”

Notice that discovery under rule 56d is not mandatory.  The requesting party must show:  that it has set forth in affidavit form the specific facts it hopes to elicit from further discovery; the facts sought exist and the sought after facts are essential to oppose summary judgment.  Grant v. Unifund CCR Partners, 842 F.Supp.2d 1234, 1242 (C.D.Cal.2012) (citing State of Cal. v. Campbell, 138 F.3d 772, 779 (9th Cir.1998).  This is a pretty tough hurdle to overcome on a legally deficient complaint.  Even if discovery is allowed, it is likely to be very narrow and eliminate much of the typical motion to compel practice.

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When representing a defendant responding to a Complaint in federal court, intellectual property attorneys are faced with many strategic choices.  For purposes of this post, we will assume that jurisdiction and venue are incontestable.  One tactic would be to simply file an Answer denying the allegations and engage in full blown discovery.  Another typical maneuver is to attack the pleadings by filing a motion to dismiss or Rule 12b6 as its known in the FRCP.  An often overlooked option is the summary judgment.

Of course, there is no one size fits all answer.  Assorted legal and factual scenarios call for different legal tools.  Every case has its own DNA.  That being said, I have found that the 12b6 motion tends to be overused while the summary judgment tends to be underused.  Many times, your defense clients are better served by a summary judgment motion rather than a 12b6 motion.

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In trademark cases involving keyword advertising, the nominative use defense is often a powerful tool that leads to early success on summary judgment.  We recently had a case where we represented a payment processor review site.  At issue was whether or not a review site is able to advertise by purchasing trademarked terms on Google Adwords.  In this post, we will run through the analysis and ultimate answer.

Where a trademark claim arises from the use of a trademark as a reference to mark owner’s goods or services such as a review site, the case is among a “class of cases where the use of the trademark does not attempt to capitalize on consumer confusion or to appropriate the cachet of one product for a different one” and the plaintiff’s claims fall to the doctrine of “nominative use.”  New Kids on the Block v. News Am. Pub., Inc., 971 F.2d 302, 308 (9th Cir. 1992).

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One issue that often faces small to medium sized companies is whether or not to buy cyber liability insurance policies.  The need and market for such policies is developing.  In this post, I will provide an overview of the product and why I recommend that our clients obtain this coverage.

First, with rare exception, today every company is a tech company.  Obviously, social networks and electronic marketplaces are run from an internet platform but the same can be said for the auto body shop that interacts with insurance carriers via web portals.  Just as tech companies have a significant brick and mortar presence, traditional brick and mortar companies transact large amounts of business online.  Because of this simple fact, I advise my clients, large to small, to obtain cyber liability coverage.

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E-tail behemoth Amazon recently filed a lawsuit against Jay Gentile, a California resident offering positive Amazon reviews for a price, otherwise known as “astroturfing”.  Gentile offered his service via the domain name “buyazonreviews.com”, among others.  Here is how the operation worked in a nutshell:  Mom and pop widget company desires four and five star reviews in order to increase consumer confidence and sales; Gentile’s service provides the widget seller with canned 4 and 5 star reviews over a period of months, so that the reviews appear legitimate and avoid Amazon’s review screening filter; and the reviews cost mom and pop about $20 per review.  Gentile’s company even went so far as to allegedly orchestrate phony baloney sales in order to achieve “verified” review status.

Quite naturally, Amazon isn’t too happy about all of this.  Consequently, Amazon deployed one of its go to law firms to attack Gentile in Court.  The problem is, I’m not too sure that Amazon’s lawsuit is legally viable, however, it does have significant strategic and practical value.  Because of this, I think it is likely to serve as an astroturfing deterrent.

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Businesses are constantly in danger of being defamed on the Internet.  Often, this defamation is anonymous.  Typically, it is committed by a competitor or a disgruntled former employee.  Because of this, it can be difficult for a business to combat the defamatory assertions.  Websites like Yelp (and blogging platforms like WordPress provide valuable consumer information, however, they can be misused for nefarious purposes.  For companies harmed by anonymous internet defamation, there is usually one goal – to remove the defamatory material.  In this post, we discuss the proper way to proceed.

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Increasingly, divorcing spouses are using data breach and privacy laws to sue each other in federal and state court.  This leads to “spillover” litigation, as the divorce proceeding spills over into another separate action.  Divorce lawyers would be well served to familiarize themselves and their clients with applicable data breach law.

The case of LaRocca v. LaRocca, 2014 WL 5040720 (E.D. La. Sept. 29, 2014) illustrated this trend in the context of claims under the Electronic Communications Privacy Act (“ECPA”).  This law prohibits unauthorized access to emails, among other things.  In the LaRocca case, Eloisa LaRocca accused her former husband of doing just that in order to gain an upper hand in the divorce.  The ex-husband moved for summary judgment on the grounds that she had no expectation of privacy.  The court denied the summary judgment, ruling that once LaRocca filed for divorce, her emails were off limits and that she had a reasonable expectation that they would not be reviewed by her soon to be ex husband.

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2014 was an interesting year in data breach litigation in California at both the federal and state level.  As always is the case in data breach cases, the requirement of a cognizable harm or “standing” took center stage.  At the state level, data breach defendants scored a huge victory in the case of Sutter Health v. Superior Court.  In contrast, at the federal level, data breach plaintiffs scored big in the case of In re Adobe.

Sutter Health involved the increasingly common situation of a stolen computer from a hospital.  The computer contained millions of patient health records.  Patients filed a class action alleging violations of the Confidentiality of Medical Information Act (“CMIA”).  The Act prohibits the disclosure of patient records and provides for statutory damages of $1,000 per breach.  Doing the math, Sutter’s liability added up to $4 billion of exposure.  The trial court denied Sutter’s demurrer resulting in an immediate appeal.

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As a follow up to my previous post, I now want to get into a liability analysis relating to the type of claims Sony could advance against media companies.  Though not addressed in the letter itself, liability is highly questionable because of robust First Amendment defenses that may be deployed by publishers in this case.  Sony and its executives could deploy a couple of conceivable legal claims in their fight against publishers.  First, there could be claims for violations of California’s Uniform Trade Secrets Act.  This Act ascribes liability to parties that disclose trade secrets information.  This requires that the disclosed Sony information actually constitute a trade secret.  In California, data can qualify as a trade secret if it derives economic value by virtue of being not generally known to the public.  Secondly, the owner of the trade secrets, in this case Sony, must have maintained reasonable efforts to keep the data secret.

Sony would likely have major difficulty qualifying much of the released data as trade secrets.  Thus far, the published data does not contain information that derives independent economic value by virtue of being a secret.  Much of the reported disclosed data is in the category of industry gossip and insults.  Similarly, data such as executive salaries lacks economic value.  Movie release date information and production expenses like actor salaries and profit participation likely would hold economic value by virtue of its secrecy.  However, Sony’s knowingly deficient data protection efforts may ensure that it fails to satisfy the element of reasonable efforts to maintain secrecy.  As a trade secrets litigator, I think Sony would be fighting an uphill battle on such claims.

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