EFF wins DVD-CCA v. Bunner Appeal

We just heard from the Court:

EFF has won the DVD-CCA v. Bunner trade secrecy appeal.

Update: Here are some interesting quotes from the opinion --

FN. 2 - "After the parties had completed the briefing on remand, DVD CCA filed a voluntary dismissal without prejudice in the court below and moved this court to dismiss the appeal as moot. Bunner opposed. Concluding that the appeal presents important issues that could arise again and yet evade review, we denied the motion."

"CSS was widely analyzed and discussed in the academic cryptography community. Another exchange of information took place on www.slashdot.org (Slashdot), a news Web site popular with computer programmers. As early as July 1999 comments on Slashdot revealed a worldwide interest in cracking CSS."

"The lawsuit outraged many people in the computer programming community. A campaign of civil disobedience arose by which its proponents tried to spread the DeCSS code as widely as possible before trial. Some of the defendants simply refused to take their postings down. Some people appeared at the courthouse on December 28, 1999 to pass out diskettes and written fliers that supposedly contained the DeCSS code. They made and distributed tee shirts with parts of the code printed on the back. There were even contests encouraging people to submit ideas about how to disseminate the information as widely as possible."

"As early as July 1999 people in the computer programming community were openly discussing the fact that the CSS code had been reverse engineered and were brainstorming ways to be able to use it legally. That means that when DeCSS appeared in October 1999 there was a worldwide audience ready and waiting to download and repost it."

"Finally, assuming the information was originally acquired by improper means, it does not necessarily follow that once the information became publicly available that everyone else would be liable under the trade secret laws for re-publishing it simply because they knew about its unethical origins. In a case that receives widespread publicity, just about anyone who becomes aware of the contested information would also know that it was allegedly created by improper means. Under DVD CCA’s construction of the law, in such a case the general public could theoretically be liable for misappropriation simply by disclosing it to someone else. This is not what trade secret law is designed to do."

"Further, assuming that an injunction against the use of information could be justified, we can conceive of no possible justification for an injunction against the disclosure of information if the information were already public knowledge."

"One of the analytical difficulties with this case is that it does not fit neatly into classic business or commercial law concepts. The typical defendant in a trade secret case is a competitor who has misappropriated the plaintiff’s business secret for profit in a business venture. In that scenario, the defendant has as much interest as the plaintiff has in keeping the secret away from good faith competitors and out of the public domain. But here, according to DVD CCA it has no good faith competitors. And the alleged misappropriators not only wanted the information for themselves, they also wanted the whole world to have it."

"We concur with the concerns expressed by Judge Whyte in his opinion in Religious Technology Center v. Netcom On-Line Com., supra, 923 F.Supp at page 1256: “The court is troubled by the notion that any Internet user, . . . can destroy valuable intellectual property rights by posting them over the Internet, especially given the fact that there is little opportunity to screen postings before they are made. [Citation.]
Nonetheless, one of the Internet’s virtues, that it gives even the poorest individuals the power to publish to millions of readers, [citation], can also be a detriment to the value of intellectual property rights. The anonymous (or judgment proof) defendant can permanently destroy valuable trade secrets, leaving no one to hold liable for the misappropriation.” (Fn. omitted.)"

Comments

[Patrick Berry]

w00t!

[Cypherpunk]

This was just about issuing a preliminary injunction to take down DeCSS. That's pretty clearly pointless now, although maybe things would have been different in 1999/2000. As I understand it, Bunner et al may still be on the hook for misappropriation, right?

"A campaign of civil disobedience arose by which its proponents tried to spread the DeCSS code as widely as possible before trial." Doesn't this amount to an open effort to misappropriate the trade secret? Civil disobedience may work if you're trying to overturn an unjust law. In this case, the First Amendment claim has been rejected, and the injunction was being denied only because the appellate court weighed the factual balance a little differently than the district court. This decision seems to offer poor prospects for a civil disobedience defense.

[Jason]

The appeal was about a preliminary injunction to take down DeCSS, but the court analyzed the issue circa 1999, not today. In other words, the court said that it was an error for the trial court ot have issued the injunction back then and never should have done so. Thus, in future cases, California courts will have instructions not to issue injunctions in similar circumstances.

As far as civil disobiedience, it depends on how you look at it. The Court did recognize a First Amendment interest in republishing and discussing information that was formerly secret, even if you knew that it might have been acquired or originally published unlawfully. That seems to draw a line between being the original discloser and being a subsequent republisher. To the extent republishing is an act of civil disobedience, the Court seems to say that will not amount to misappropriation:

"Finally, assuming the information was originally acquired by improper means, it does not necessarily follow that once the information became publicly available that everyone else would be liable under the trade secret laws for re-publishing it simply because they knew about its unethical origins."

[Cypherpunk]

I see on further research that the ultimate issue about whether the publication was misappropriation may not actually go to trial, as the DVD consortium is trying to withdraw their lawsuit, while the EFF, paradoxically, is trying to keep it going!

It's true that the appellate court decided that there was not clear evidence presented in the original case to establish trade secret status by late 1999 when the lawsuit was established. However, the court certainly did not determine the contrary, that trade secret had been lost. Rather, the burden of proof was on the DVD consortium and it failed to meet that burden.

I'm skeptical that this decision, with its detailed, fact-based analysis, will set a precedent sweeping enough to apply to future cases. But we'll see.