The past year has produced noteworthy decisions from the
Sixth,
Ninth and
Eleventh Circuit Courts of Appeals – and recent
Congressional hearings – regarding the applicability
of the Computer Fraud & Abuse Act ("CFAA") to
employers' claims that disloyal employees accessed their
employers' computers in order to take trade secrets, source
code, and other valuable electronically stored information. The
CFAA provides a federal, private right of action against any person
who "knowingly and with intent to defraud, accesses a
protected computer without authorization, or exceeds authorized
access, and by means of such conduct furthers the intended fraud
and obtains anything of value... ." 18 U.S.C. §
1030(a)(4).
The recent decisions and congressional hearings are fueling one of
the hotter debates within the judicial and legislative branches of
the federal government: the extent to which Congress meant to
"federalize" certain computer-related disputes between
employers and their employees. On this legal question, there is a
continuum of interpretations of the CFAA. Some interpret the CFAA
as giving employers a federal cause of action against their
disloyal departing employees, in what has been perceived as a
pro-employer interpretation. On the other end of this continuum are
what would appear to be employee-centric opinions holding that the
CFAA does not create such a right in employers.
The next case to watch in this debate over the scope of the CFAA might be Metabyte, Inc. v. Nvidia Corp., et al. According to the Complaint (available in .pdf format below), Metabyte is an information technology services company that produces software and provides product development, consulting and related information technology staffing services. Metabyte claims that it produced an original 3D technology, which consists of executable source code and enables a three-dimensional display through specialized glasses used for viewing computer screens. The primary application for this software and the glasses is for personal computer-based gaming, according to the Complaint.
Metabyte alleges that it developed its 3D software through the investment of millions of dollars and the efforts of its software developer-employees, and Metabyte has made the conduct of these software developers the epicenter of its Complaint. According to Metabyte, these employees – now Nvidia's co-defendants – left Metabyte and joined Nvidia, where they allegedly developed a 3D technology for Nvidia that is similar to Metabyte's 3D technology. But before Metabyte's former software developers left, Metabyte contends, they improperly copied the source code for Metabyte's 3D technology, then used this source code to create Nvidia's competing 3D technology.
At the moment, only Metabyte's side of the story is public.
However, the allegations in the Complaint set the stage for another
"employer versus allegedly faithless employee" showdown.
The disposition of these allegationswill turn, among other things,
on the district court's interpretation of the scope of the
CFAA, the accuracy of the allegations against Metabyte's former
software developers, the timing and circumstances of the purported
accessing of Metabyte's computers, and the extent to which
Metabyte took steps to restrict the access of its software
developers.
This blog will keep its eye on Metabyte, and any decisions
regarding the CFAA that result from this case.
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