Facebook, Inc. v. Power Ventures, Inc., 2013 WL 5372341 (N.D. Cal. Sept. 25, 2013)

Facebook, Inc. v. Power Ventures, Inc., 2013 WL 5372341 (N.D. Cal. Sept. 25, 2013)

There have been several orders in this case and the order listed above is an order denying leave to file a motion for reconsideration of the court’s previous order granting summary judgment for Facebook. It is helpful to read this order in conjunction with the prior order granting summary judgment, Facebook, Inc. v. Power Ventures, Inc., 844 F. Supp.2d 1025, 1028 (N.D. Cal. 2012) (hereinafter, the “MSJ Order”).

Power Ventures operated a website that interfaced with Facebook and permitted its users to access Facebook via its website. Facebook sued Power Ventures for violating the Computer Fraud and Abuse Act premised on the allegation that Power Ventures induced Facebook users to provide it with their login information which it then used to “scrape” Facebook’s proprietary material and display it on its website. Facebook’s “Terms of Use require users to refrain from using automated scripts to collect information from or otherwise interact with Facebook, impersonating any person or entity, or using Facebook website for commercial use without the express permission of Facebook.” MSJ Order at 1028. Facebook never gave Power Ventures permission to use the material it obtained from Facebook in this way.

The court’s orders set out several relevant legal principles:

  • “Power Ventures, by accessing Facebook without authorization, and obtaining information from the Facebook website, violated the provision of CFAA that imposes liability on any party that “intentionally accesses a computer without authorization or exceeds authorized access, and thereby obtains … information from any protected computer,” 18 U.S.C. § 1030(a)(2)(C).”
  • The September 25 Opinion does not explain why Power Ventures’ access of Facebook is unauthorized and, in fact, implies that it is because of a violation of Facebook’s Terms of Use which is in direct conflict with the Ninth Circuit’s Strict Access Theory jurisprudence. The MSJ Order, however, clarifies this and makes it clear that the access is not deemed unauthorized because of the Terms of Use, but because Power Ventures circumvented technical or code-based barriers in order to access Facebook. MSJ Order at 1036.
  • Nothing in the plain language of Section 1030(a)(2)(C) requires that taken information be destroyed.
  • “[T]he costs Facebook incurred to block Defendants from the site, to investigate Defendants’ activities, and to have its attorneys attempt to stop Defendants from continuing the activities were sufficient to establish loss under the CFAA.” 
  • A company’s CEO can be held personally liable, and jointly and severally liable with the company, for violations of the Computer Fraud and Abuse Act because “where an officer authorized, directed, or participated in a corporation’s tort or statutory violation, the officer can be held personally liable.”
  • “Facebook is thus entitled to recover compensatory damages under the statute. Facebook has established through undisputed testimony that it expended to investigate Defendants’ actions and for outside legal services in connection with the Defendants’ actions. Accordingly, this Court grants Facebook compensatory damages in the amount of $.”
  • The court provides a solid analysis of the four factors required to obtain a permanent injunction under the CFAA.

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