UnIntellectual Property (UnIP): Trade Secret for Online Database

The United States District Court for the Southern District of New York granted Defendant’s Motion for Summary Judgment, holding that Plaintiff did not possess the requisite trade secret for its trade secret misappropriation claim.  Both Plaintiff and Defendant provide construction product information (“CPI”).  Plaintiff and Defendant are the two national level provider of CPI services, which includes nationwide searchable databases that can filter projects based on the user’s preferences. For example, a user can search for library projects in Topeka, Kansas, worth more than three million dollars, that need plumbing in the next two months. The CPI service will collect all the projects meeting those specifications and provide plans, bidding information, and contact information for the planner, architect, or general contractor on the job. Reed and McGraw–Hill each sell CPI subscriptions at the national, state, and local levels.  When Defendant secretly subscribed to Plaintiff’s service in order to perform comparisons and ensure its database was complete, Plaintiff sued for misappropriation of trade secrets, among other things.

The Court said: “It is clear that under New York law, which is more permissive than Georgia law, Reed’s CPI lost its trade-secrets status-if it ever had any-when Reed gave out free trial subscriptions unaccompanied by any contractual restrictions on their use.”

So, the Court relied upon lack of maintained secrecy.  However, were other reasons present?  Was this information even a trade secret?  Perhaps a compilation trade secret?  Would New York and Georgia law, the latter follows UTSA, have come out the same on these issues?

Reed Const. Data Inc. v. McGraw-Hill Companies, Inc., 09-CV-8578 JPO, 2014 WL 4746130 (S.D.N.Y. Sept. 24, 2014).

 

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