New “Employment” Computer Fraud and Abuse Act case … but with a twist!

It’s always the same: Employee decides to go work for a competitor. Employee takes confidential information. Employee uses it in new job with competitor. Employer sues.

We see it all the time and, in fact, it is probably the most common scenario of cases asserting claims under the Computer Fraud and Abuse Act (“CFAA”), 18 U.S.C. § 1030, et seq. This case, however, handed down on April 20, 2011, has an interesting twist.

In Meats by Linz, Inc. v. Dear, 2011 WL 1515028 (N.D. Tex. Apr. 20, 2011), the court handed down a decision denying the Defendant’s Motion to Dismiss the CFAA claim on two distinct grounds: “access” and “loss”.

The Facts, Just the Facts

Steve Dear was employed by Meats by Linz, Inc. (“MBL”) as the general manager of its Dallas sales facility. He had an employment agreement that included a confidentiality / non-disclosure agreement. Dear decided to go work for one of MBL’s competitors but, before announcing he would be leaving, accessed MBL’s password-protected confidential and proprietary information to which only he, and others on a “need to know” basis, had access. In fact, he accessed it at 9:15 p.m. on a Sunday night, downloaded it, and sent an email resignation about two hours later. In the words of Gomer Pyle, “Surprise! Surprise!” … not long afterwards, he was working for a competitor and soliciting MBL’s customers by, according to MBL, using its confidential and proprietary information that he had taken.

Employer Sued

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