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Eastern District of New York Holds That Contact List Is Not Entitled to Trade Secret Protection Because Information is Readily Duplicated Through Facebook or LinkedIn

In Customer lists, Ready Ascertainability, Secrecy, Sister State Construction of UTSA on September 29, 2010 at 5:23 am
Eastern District of New York Courthouse
Image by Ann Althouse via Flickr

In a sign of the times, District Judge Arthur D. Spatt of the Eastern District of New York adopted the recommendations of Magistrate Judge A. Kathleen Tomlinson who denied a motion for preliminary injunction in a trade secrets misappropriation case involving a customer list.  Sasqua Group, Inc. v. Courtney, No. CV 10-528(ADS)(AKT), 2010 WL 3613855 (E.D.N.Y. 2010 Aug. 2, 2010) (slip op.). The court reasoned that because the information could be properly acquired or readily duplicated through public databases such as Facebook and LinkedIn, the information was not entitled to trade secret protection.  Id. *23.

In sum, Plaintiffs have failed to prove a physical appropriation or copying of confidential information or wrongful disclosure or use of a trade secret. See Leo Silfen, 29 N.Y.2d at 389, 328 N.Y.S.2d at 424, 278 N.E.2d 636. The information in Sasqua’s database concerning the needs of its clients, their preferences, hiring practices, and business strategies, as well as Sasqua’s acquaintance with key decision-makers at those firms may well have been a protectable trade secret in the early years of Sasqua’s existence when greater time, energy and resources may have been necessary to acquire the level of detailed information to build and retain the business relationships at issue here. However, for good or bad, the exponential proliferation of information made available through full-blown use of the Internet and the powerful tools it provides to access such information in 2010 is a very different story.

Id. *6 (emphasis supplied).

Judges and Attorneys

District Judge Arthur D. Spatt adopting the recommendations of Magistrate Judge A. Kathleen Tomlinson.

Emily A. Kim, Richard P. Swanson, Arnold & Porter LLP, New York, NY, for Plaintiffs.

Martin J. Murray, Nora Von Stange, Law Offices of Martin J. Murray, New York, NY, for Defendants.

By CHARLES JUNG

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