IT Law Alert September 17, 2013
Accessing Competitive Software As A Trade Secret Violation:
State trade secret laws protect the source code, or hidden, portion of software. A new federal court decision suggests that trade secret protection may also extend to the object code portion of software that is accessible and visible to the end user.
AirWatch LLC has various software products, including an application that allows a user to securely send email and documents from a smartphone. AirWatch offers a thirty day free trial of its software, subject to the terms of an end user license agreement (“EULA”).
In a lawsuit brought by AirWatch against its competitor, Mobile Iron, AirWatch alleged that two of Mobile Iron’s employees, using false identification, signed up for the free trial and accessed AirWatch software. AirWatch claimed violations of various state and federal laws, including Georgia’ s trade secret law.
Mobile Iron moved to dismiss the trade secret claim, arguing that the output of software that is accessible and visible to the public by AirWatch is not a trade secret. Denying the motion, the court pointed out that the EULA prohibits a user from engaging in “competitive analysis.” The court went on to state that “information regarding AirWatch’s software may still be a trade secret, if AirWatch can show that it worked to preserve the secrecy of its program’s functions, specification and pricing.”
Read the court’s decision here.
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