126 F. Supp. 3d 1154
E.D. Cal.2015Background
- Water Well and Welenco allege multiple claims against Craig Corbell, Boredata, Gary Corbell, and Boredata; motions for summary judgment were filed and opposed; evidentiary sanctions were issued restricting certain witnesses and documents; the court granted sanctions in part and the matter proceeded to summary judgment briefing; the court ultimately GRANTED in part and DENIED in part the defendants' summary judgment motions; the court denied sealing requests and ordered redactions for certain third-party data.
- Welenco alleges Craig Corbell formed Boredata using Welenco confidential information; Craig allegedly downloaded Welenco files and diverted business after leaving Welenco; a contemporaneous employment agreement bound Craig to confidentiality and non-solicitation terms; Boredata was formed with Gary’s loan; the court evaluated CFAA, CDAFA, copyright, Lanham Act, trespass, UTSA trade secrets, breach of employment agreement, and UCL claims.
- Evidentiary sanctions barred certain non-personal-knowledge testimony and precluded some documents; the court considered only admissible, properly authenticated or properly authenticated-at-trial documents in ruling on summary judgment.
- Key undisputed facts include Welenco ownership of certain drawings, a confidential customer list, and Craig’s departure to form Boredata with Gary’s assistance; the employment agreement’s term and renewal provisions and its confidentiality/non-solicitation provisions were central to several claims.
- The court’s legal standard for summary judgment, including the Nosal standard for CFAA and the distinction between authorized access and misappropriation; the court applied California UTSA standards to misappropriation and examined ownership of copyrights and the timing of registration.
- The court concluded the following dispositive outcomes: CFAA claim against Craig GRANTED; CDAFA claim GRANTED; copyright infringement claim GRANTED; Lanham Act claims GRANTED; employment agreement breach claim AGAINST Craig DENIED; Gary Corbell’s related claims GRANTED in part or entirely depending on the count; sealing denied.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| CFAA claim viability against Craig | Craig exceeded access to Welenco data. | No hacking; no unauthorized access. | GRANTED; no CFAA violation. |
| CDAFA claim viability against Craig | Password withholding and access disruption. | Disruption was minimal; no unauthorized access. | GRANTED; no CDAFA violation. |
| Copyright infringement viability | Welenco owned the drawings; infringement occurred. | Unclear ownership; no damages post-registration. | GRANTED; no actionable infringement. |
| Lanham Act (false designation/advertising) | Defendants misrepresented origin and advertised falsely. | No supporting evidence of false statements or ads. | GRANTED; claims dismissed. |
| Breach of employment agreement by Craig | Craig breached confidentiality/non-solicitation; agreement may have continued. | Agreement expired or undisputed termination. | DENIED; triable issue as to existence/continuation of agreement. |
Key Cases Cited
- United States v. Nosal, 676 F.3d 854 (9th Cir. 2012) (defines 'exceeds authorized access' in CFAA; limits misuse vs. hacking.)
- Feist Publ’ns., Inc. v. Rural Tel. Serv. Co., 499 U.S. 340 (U.S. 1991) (copyright ownership requires original expression and valid registration.)
- Perfect 10, Inc. v. Visa Int’l Serv., Ass’n, 494 F.3d 788 (9th Cir. 2007) (contributory infringement requires culpable intent/illegal objective.)
- Ellison v. Robertson, 357 F.3d 1072 (9th Cir. 2004) (knowledge can be inferred for contributory infringement.)
- Cel-Tech Commc’ns, Inc. v. Los Angeles Cellular Telephone Co., 20 Cal.4th 163 (Cal. 1999) (unlawful practice requires borrowing a law; UCL claim relies on other violations.)