Private Facebook information Remains “Private” – So Far

Quiet Court in Session“Private” Facebook Posts are “Private” 

FACEBOOK, INC., Petitioner, v. THE SUPERIOR COURT OF SAN DIEGO COUNTY, Respondent; LANCE TOUCHSTONE, Real Party in Interest – (9/26/17)

Here, in Facebook v. Touchstone, a subpoena seeking to obtain “private” Facebook information is at stake. In this regard, real party in interest Lance Touchstone is awaiting trial in respondent San Diego County Superior Court (the trial court) on a charge of attempting to murder Jeffrey R. (the victim). (Pen. Code, §§ 664/187, subd. (a).) After the shooting incident, the victim has been active on his personal Facebook, Inc., (Facebook) account. He posted updates of his physical recovery from the hospital, requesting private messages over the Facebook messaging system. On the public portion of his Facebook page that is visible to all Facebook users, the victim posted updates of court hearings in this case, asking his friends to attend the preliminary hearing. In public posts the victim also discussed his personal use of guns and drugs, and described his desire to rob and kill people.

Believing nonpublic content of the victim’s Facebook account might provide exculpatory evidence helpful in preparing for trial, Touchstone served petitioner Facebook with a subpoena for the subscriber records and contents of the victim’s Facebook account, including timeline posts, messages, phone calls, photos, videos, location information and user-input information from account inception to the present date. Facebook filed a motion to quash the subpoena on the ground the Stored Communications Act (SCA) (18 U.S.C.2 § 2701 et seq.) prohibited disclosure of the victim’s account contents. In an accompanying declaration, counsel for Facebook stated that Touchstone could obtain the requested contents directly from the victim or by working with the prosecutor to obtain a search warrant based on probable cause. Touchstone opposed the motion on the grounds he had a plausible justification for requesting the contents of the victim’s account, he should be allowed to obtain the contents because law enforcement could do so by a search warrant, his constitutional right to a fair trial trumped the SCA, and he could not obtain the contents from other sources because the victim was uncooperative and the prosecutor had not obtained a search warrant. At oral argument, defense counsel represented that the prosecution refused to issue a search warrant for the material and that she has been unable to locate the victim to serve him with a subpoena. The trial court denied the motion to quash and ordered Facebook to produce the contents of the victim’s account for in camera inspection by a certain date.

In the end, the Court held, “The SCA expressly prohibits electronic communication service providers from “knowingly divulg[ing] to any person or entity the contents of a communication.” (§ 2702(a)(1).) This statutory prohibition is subject to limited exceptions, none of which apply. (§ 2702(b)(1)-(8).) As we have discussed, Touchstone’s constitutional challenges to the SCA lack merit. Accordingly, the supremacy clause (U.S. Const., art. VI) prohibits enforcement of the trial court’s order because “California’s discovery laws cannot be enforced in a way that compels [a provider] to make disclosures violating the [SCA].” (Negro v. Superior Court, supra, 230 Cal.App.4th at pp. 888-889.).”

Until the California Supreme Court finally decides the matter in Facebook1, which is pending before the High Court, Facebook “private” information will remain private.

Eric Papp, Esq.

Visit: www.ca-nvlaw.com

Yelp Ordered to Produce Documents Identifying Anonymous Negative Poster

Orange County Court House

Be Careful When Posting Negative Yelp Reviews to “Get Even.” It May Just Land YOU in a World of Legal Trouble.

In this case, Montagna filed a lawsuit against Sandra Jo Nunis and several Doe defendants alleging a single cause of action for trade libel. According to the first amended complaint, Montagna, an accountant, prepared a tax return for Nunis in 2015. Montagna initially quoted Nunis a “minimum” fee of $200 for the preparation of her return, based on her representation that her income was comprised exclusively of wages reported on a W-2 form, and she would require only a simple return. However, both Nunis’ income and the resulting tax return were allegedly more complicated than she had represented. As a consequence, Montagna charged Nunis $400 for preparation of the return, rather than the $200 fee he initially quoted. Nunis allegedly paid Montagna only $200, and refused to pay him more even after receiving “a collection letter” for the balance. And in November 2015, Nunis allegedly went online to the Yelp website and posted the following review of Montagna, using the alias Alex M.:

“Too bad there is no zero star option! I made the mistake of using them and had an absolute nightmare. Bill was way more than their quote; return was so sloppy I had another firm redo it and my return more than doubled. If you dare to complain get ready to be screamed at, verbally harassed and threatened with legal action. I chalked it up as a very expensive lesson, hope this spares someone else the same.”

Montagna alleged the following statements made by Nunis in the review were provably false: (1) the return he had prepared for her was accurate and complete; (2) he had not caused her to hire another firm to redo his work; (3) he was not negligent in preparing her return, such that her refund more than doubled; and (4) no one in his office screamed at, harassed, or threatened her. Montagna allegedly sent a demand to Nunis, asking she retract the Yelp review, or correct the false and libelous statements, and warned her that if she failed to do so, legal action might be taken against her. Nunis, however, allegedly failed and refused to either delete or correct her review and Montagna thereafter filed the lawsuit.

A subpoena was issued to Yelp to confirm the identity of the “anonymous” poster.  Yelp fought the Subpoena on a number of grounds, including “Freedom of Speech of the Poster,” and lost.  The Court held,

“We are unpersuaded by Yelp’s contention because we cannot agree with its characterization of the review. While it is true that pure expressions of opinion are not actionable, “[t]hat does not mean that statements of opinion enjoy blanket protection. [Citation.] To the contrary, where an expression of opinion implies a false assertion of fact, the opinion can constitute actionable defamation. [Citation.]” (GetFugu, Inc. v. Patton Boggs LLP (2013) 220 Cal.App.4th 141, 156 (GetFugu).)”

And, as such, the Court ordered, “…we conclude the latter finding was sufficient to support the trial court’s order compelling Yelp to produce the subpoenaed documents in the circumstances of this case.”

The lawsuit against the Yelp poster will proceed.

(YELP INC., Petitioner, v. THE SUPERIOR COURT OF ORANGE COUNTY, Respondent; GREGORY M. MONTAGNA et al.(11/13/2017).)

Eric Papp, Esq.

Visit: www.ca-nvlaw.com

The “Black Box” in your car

The "Black Box" in your car. The Event data Recorder (EDR) If you have been in a car accident, be aware that there is a little known or utilized piece of evidence in later model cars, a “black box.” Technically, it is called the Event Data Recorder (EDR). While it doesn’t necessarily record everything, it may record such things as acceleration, deceleration, impacts, braking, if seat belts were used, speed at the time of the crash, steering angle and if the airbags were deployed. This “objective” data, might help to clarify witness statements. However, be aware that in some instances the data can be overwritten. So you might have to move quickly to preserve it.

Eric Papp, Esq.

Visit: www.ca-nvlaw.com

How “Secret” is Secret for a Trade Secret?

Top SecretReasonable Efforts to Maintain Secrecy is a Question of Fact
Whether reasonable secrecy efforts were made is a question of fact. (San Jose Const., Inc., 155 Cal.App.4th at 1543 (“[W]hether SJC made adequate attempts to keep its prospective project information secret is for the jury to measure.”); In re Providian Credit Card Cases (2002) 96 Cal.App.4th 292, 306 (“[W]hether a party claiming a trade secret undertook reasonable efforts to maintain secrecy is a question of fact….”); Mattel, Inc. v. MGA Entertainment, Inc., 782 F.Supp.2d 911, 960 (C.D. Cal. Jan. 5, 2001) (“The determination of whether information is the subject of efforts that are reasonable under the circumstances to maintain its secrecy is fact specific.”). Here, for example, is the office or location in question; is office is “off limits;” do the computers have a password; is access restricted to certain people; are there non-disclosure or confidentiality agreements, even oral ones, in place? Importantly, secrecy efforts need only be reasonable under the particular circumstances involving a specific party, industry and situation. (DVD Copy Control Assn., Inc. v. Bunner (2003) 31 Cal.4th 864, 881(“The secrecy requirement is generally treated as a relative concept and requires a fact intensive analysis.”); see generally CACI No. 4404.) Here, the trade secret plaintiff may not be in the aerospace industry or computer software engineering firm. In this case, we may be talking about small, mom and pop operations. In such a circumstance, whether the security which was implemented by the trade secret Plaintiff was reasonable is a question of fact for the jury.

Eric Papp, Esq.

Can Information That is “Generally Known” Be a Trade Secret?

uniqueWhether Information is Generally Known is a Question of Fact

Whether the subject information is generally known to the public or competitors is a question of fact. (Thompson v. Impaxx, Inc. (2003) 113 Cal.App.4th 1425, 1430 (“The issue of whether information constitutes a trade secret is a question of fact.”).) Again, as the Altavion court held, “…even if some or all of the elements of Altavion’s design were in the public domain and thus unprotectable, the combination was a protectable trade secret if it was secret and had independent economic value.” (Emphasis original) (Altavion, Inc. v. Konica Minolta Systems Laboratory Inc. (2014) 226 Cal.App.4th 26, 47.)

So, the first inquiry is whether or not the information is “generally known” to the public or competitors.  However, even if some aspect is “generally known,” a novel or unique combination of the information may remove it from the “generally known” into a trade secret.

Eric Papp, Esq.

Trade Secrets Do Not Need to Be in Writing

Legal Pad, pen and law book5. Trade Secrets do Not Need to be in Writing

Trade secrets need not be in writing. (Morlife, Inc, 56 Cal.App.4th at 1522 (“to afford protection to the employer, the information need not be in writing but may be in the employee’s memory”); Brocade Communications Systems, Inc. v. A10 Networks, Inc., 873 F.Supp.2d 1192, 1215 (N.D. Cal. June 12, 2012) (“It is this combination of elements that makes the information valuable and not generally known to the public. Moreover, the mere fact that the information is not in a written list is not dispositive of sufficient particularity.”) Here, many trade secret Defendants attempt to make much of the fact that some of the information in contention was in the Defendant’s “head.” However, as cited above, this is not dispositive and, at best, raises an issue of material fact as to what exactly was in the Defendant’s head and what combination of facts, whether in his head or not, fall under the Trade Secret claim.

What if the information is “generally known,” can that still be a trade secret? The next post will cover this question.

Eric Papp, Esq.

Public Information as a Trade Secret

Private Property - public info4. Public Information as a Trade Secret
Importantly, a trade secret may consist of public information and/or elements, combined with information and/or elements that are not generally known, as long as the combination is unknown, kept secret, and has independent economic value. (Altavion, Inc., 226 Cal. App. 4th at 48 (“even if some or all of the elements of [the plaintiff’s] design were in the public domain and thus unprotectable, the combination was a protectable trade secret if it was secret and had independent economic value”) (original italics); 02 Micro Int’l Ltd. v. Monolithic Power Sys., Inc., 420 F.Supp.2d 1070, 1089-1090 (N.D. Cal. March 9, 2006) (court affirmed jury instruction which stated, “Combinations of public information from a variety of different sources when combined in a novel way can be a trade secret. It does not matter if a portion of the trade secret is generally known, or even that every individual portion of the trade secret is generally known, as long as the combination of all such information is not generally known.”); SkinMedica, Inc. v. Histogen Inc., 869 F.Supp.2d 1176, 1194 (S.D. Cal. April 23, 2012) (“A trade secret may be comprised of partly or entirely non-secret elements and still merit protection.”) Often, the Defendants in a trade secret case, as those in the San Jose Const. case, complain that the information sought to be protected by Plaintiff was, in some manner, public. But, again, that is not fatal to a trade secret case. Rather, it is about having all the pieces of the puzzle to the exclusion of all others.

Must Trade Secrets be in writing? The next post will cover this topic

Eric Papp, Esq.

“Information” as a Trade Secret

Hand in the cookie jarImportantly, “Whether information is a trade secret is ordinarily a question of fact.” ( San Jose Const., Inc. v. S.B.C.C., Inc. (2007) 155 Cal.App.4th 1528, 1537 citing: In re Providian Credit Card Cases (2002) 96 Cal.App.4th 292, 300; Thompson v. Impaxx, Inc. (2003) 113 Cal.App.4th 1425, 1430; and Morlife, Inc. v. Perry (1997) 56 Cal.App.4th 1514, 1521, 66 Cal.Rptr.2d 731.) As the San Jose Const. Inc. case held, “Whether that information actually constituted a trade secret is a factual issue for the jury or court to determine at trial, as did the trial court in Morlife.” (San Jose Const., Inc. v. S.B.C.C., Inc. (2007) 155 Cal.App.4th 1528, 1540, citing Morlife v. Perry, supra, 56 Cal.App.4th 1514 at 1521.)

1. Facts as Trade Secrets
Trade secrets can consist of facts. (See Silvaco Data Systems v. Intel Corp., (2010) 184 Cal.App.4th 210, 220-221, as modified on denial of reh’g (May 27, 2010) disapproved of on other grounds by Kwikset Corp. v. Superior Court (2011) 51 Cal. 4th 310 (“Indeed a trade secret may consist of something we would not ordinarily consider an idea (a conceptual datum) at all, but more a fact (and empirical datum), such as a customer’s preferences, or the location of a mineral deposit. In either case, the trade secret is not the idea or fact itself, but information tending to communicate (disclose) the idea or fact to another. Trade secret law, in short, protects only the right to control the dissemination of information.”) (original italics) (Bold emphasis added).)

2. Ideas as Trade Secrets
Trade secrets may relate to ideas, even potentially patentable ideas, as well. (Altavion, Inc. v. Konica Minolta Systems Laboratory, Inc. (2014) 226 Cal.App.4th 26, 54-55 (“[I]t has been held that a trade secret in the broad sense consists of any unpatented idea which may be used for industrial and commercial purposes . . . . In conclusion, it is clear that if a patentable idea is kept secret, the idea itself can constitute information protectable by trade secret law.”) (italics omitted); Mattel, Inc. v. MGA Entertainment, Inc., 782 F.Supp.2d 911, 961-962 (C.D. Cal. Jan. 5, 2011.) Here, for example, if the ideas were kept secret, then, in short, the Plaintiff had all the pieces of the puzzle to the exclusion of all other competitors.

3. Negative Information as Trade Secrets
Trade secrets can consist of “negative information,” or information that results from failed efforts or experiments, because such “dead ends” in research or marketing may have value. (See, e.g., Cal. Civ. Code § 3426.1 comment (“The definition of trade secret . . . includes information that has commercial value from a negative viewpoint, for example the results of lengthy and expensive research which proves that a certain process will not work could be of great value to a competitor.”) (original italics); Courtesy Temporary Service, Inc. v. Camacho (1990) 222 Cal.App.3d 1278, 1287 (“The broader definition in the proposed Act . . . includes information that has commercial value from a negative viewpoint, for example the results of lengthy and expensive research which proves that a certain process will not work could be of great value to a competitor.”) (original italics) citing legis. committee com., Cal. Civ. Code § 3426.1, p. 108.) Here, for example, this is an important observation. Imagine a trade secret defendant who would declines to bid any job they know the Plaintiff is already supplying or that the Plaintiff can supply cheaper.”

This is exactly the type of secret, competitive information that anyone would like to have. Information that allows you to not waste your time, money and energy bidding and quoting and competing with an entity you know you cannot beat on certain jobs or, obversely, know you can beat on others. Oftentimes, the only way to know these competitive outcomes for certain, would be be to use the Plaintiff’s trade secret information, that is, to have all the pieces to the puzzle that the Defendant could use to bid jobs in order to beat the Plaintiff or to avoid other jobs altogether.

The next post will cover “Public” information as trade secrets.

Eric Papp, Esq.

Trade Secrets

 Watch out for snakes

“There’s no art to find the mind’s construction in the face: He was a gentleman on whom I built an absolute trust.” Macbeth ( 1.4.12-14)

“Trade secret law also helps maintain ‘standards of commercial ethics….’[Citation.] … By sanctioning the acquisition, use, and disclosure of another’s valuable, proprietary information by improper means, trade secret law minimizes ‘the inevitable cost to the basic decency of society when one … steals from another.’ [Citation.] In doing so, it recognizes that ‘good faith and honest, fair dealing, is the very life and spirit of the commercial world.’” (Altavion, Inc. v. Konica Minolta Systems Laboratory Inc. (2014) 226 Cal.App.4th 26, 42 citing DVD Copy Control Assn., Inc. v. Bunner (2003) 31 Cal.4th 864, 881.) This is exactly what is at stake in most trade secret cases – honesty, ethics and fair dealing

Most trade secret cases are is not about the formula to Coke, but rather, as in the San Jose Const., Inc. case, it is about having all the pieces to the puzzle. (San Jose Const., Inc. v. S.B.C.C., Inc. (2007) 155 Cal.App.4th 1528, 1539.) In this regard, California’s version of the Uniform Trade Secret Act (“UTSA”) defines a “trade secret” as “information, including a … compilation … that: (1) Derives independent economic value, actual or potential, from not being generally known to the public or to other persons who can obtain economic value from its disclosure or use; and (2) Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.” (Civ.Code, § 3426.1, subd. (d).) (San Jose Const., Inc. v. S.B.C.C., Inc. (2007) 155 Cal.App.4th 1528, 1537.)

However, as shown below, each of these elements involve a questions of fact.

Additionally, the statute includes a nonexclusive list of certain types of “information,” which includes, but is not limited to, “a formula, pattern, compilation, program, device, method, technique, or process.” As discussed below, the term “information” is not a significant limitation, as trade secrets may consist of any and all types of facts, ideas, devices, methods, or combinations thereof, regardless of whether it is novel or inventive, as long as the other requirements for establishing a trade secret are satisfied, i.e., that the “information” is secret and has independent economic value.

As the Altavion, Inc. case held,

‘Information’ has a broad meaning under the [UTSA].” (Trade Secrets Practice in Cal., supra, § 1.4, p. 1–5; see also Forro Precision, Inc. v. International Business Machines Corp. (9th Cir.1982) 673 F.2d 1045, 1057. “The definition of trade secret is … unlimited as to any particular class or kind of matter…“[A] trade secret may consist of any formula, pattern, device or compilation of information which is used in one’s business, and which gives him an opportunity to obtain an advantage over competitors who do not know or use it.” (Emphasis added) (Altavion, Inc. v. Konica Minolta Systems Laboratory Inc. (2014) 226 Cal.App.4th 26, 53.)

It is exactly this compilation of information that is at issue in many trade secret cases.

The Completed Puzzle
“Even still, you’re not going to divulge everything.”

The San Jose Construction case is worthy of a close examination. In San Jose Construction, the employer, San Jose Construction (“SJC”), filed suit against its former employee, Foust, and Foust’s new employer, South Bay Construction Company (“S.B.C.C.”), for among other things, Misappropriation of Trade Secrets. Foust gathered information, contacted clients and had contracts and projects moved to his new employer while he was still fully employed by SJC. Foust was not an officer, director nor owner of SJC. In San Jose Construction, the Defendant filed summary judgment claiming that there could be no trade secrets because the information in contention was public, was created by and/or published to third parties and much of it was created by Foust while he worked at SJC. Moreover, the defendants argued that the information could not be trade secrets because third parties were free to share it with anyone they chose. However, the San Jose Construction Court reversed summary judgment noting that,

As SJC describes it, “only SJC had the completed puzzle for each project, contained in the Project Binders…. No third party had it. The subcontractors each had a piece, and the owners had a piece, but no one except SJC had it all.” (San Jose Const., Inc. v. S.B.C.C., Inc. (2007) 155 Cal.App.4th 1528, 1538-1539.)

In many cases, only the trade secret Plaintiff has the “completed puzzle” for what constitutes the trade secrets, to the exclusion of any competitors.

The next few posts will examine the question of what can be trade secrets

Eric Papp, Esq.

When is the Jury “Impaneled and Sworn” for Purposes of the Five Year Rule of CCP § 583.310, et seq.

Jury impaneled and sworn

The case of RUTH McCLAMMA STUEVE et al., v. BUCHALTER NEMER et al., answered this very question. The Stueve case stated: Generally, an action must be “brought to trial” within five years of the filing of a civil complaint. (Code Civ. Proc., § 583.310, et seq.) 1 If the time period is not tolled by statute, the case must be dismissed. (§§ 583.340, 583.360.) “In an action tried to a jury, the action is brought to trial when the jury is impaneled and sworn.” (Bruns v. E-Commerce Exchange, Inc. (2011) 51 Cal.4th 717, 723) (Bruns), italics added.) Here, with just three days remaining before the fifth anniversary of the filing of a civil complaint, a panel of 75 prospective jurors assembled in a courtroom for jury selection (voir dire). The court clerk administered an oath and the panel swore to give truthful answers. Seven days later, while voir dire was still in progress, defendants moved to dismiss under the five-year dismissal statute. The trial court granted the motion, finding that the jury had not yet been “impaneled and sworn.” We reverse. The jury was “impaneled” when the panel of prospective jurors assembled in the courtroom for voir dire. The panel was “sworn” when the prospective jurors took an oath to respond truthfully. Accordingly, the action was, in fact, “brought to trial” within five years of the filing of the civil complaint. Thus, the trial court should not have granted defendants’ motion to dismiss.

The Court noted that when the jury is assembled in the courtroom for voir dire, they are given the “oath of truthfulness.”  However, once selected, the jury is sworn a second time to “try the cause.”

In this regard, the Stueve Court held:

The word “impaneled” is not defined within the Act, but generally means: “The act of the clerk of the court in making up the list of jurors who have been selected for the trial of a particular cause. All the steps of ascertaining who shall be the proper jurors to sit in the trial of a particular case up to the final formation.” (Black’s Law Dict. (6th ed. 1990) p. 752, cols. 1 & 2.)The word “sworn” is similarly not defined within the Act, but generally means providing an affirmative response to an oath or affirmation. (§ 2093 [a judge or a court clerk may “administer oaths or affirmations”].)  Based on the foregoing, we conclude that a jury is impaneled when the jury trial panel of prospective jurors is assembled in a courtroom for the purposes of voir dire. We note that the word “panel” is used consistently throughout the statutes and refers exclusively to the “prospective juror[s],” not the final “trial jurors.” Further, we conclude that a panel is sworn when the court (usually the court clerk) administers the initial oath of truthfulness and the panel collectively responds, “I do.” Although the actual trial jurors will ultimately be sworn again—this time to try the cause—that does not negate the fact that the panel was sworn at the beginning of voir dire. Accordingly, in this case the jury was impaneled and sworn on September 21, 2015, at the beginning of voir dire.

Eric Papp, Esq.