Events Media Network, Inc. v. The Weather Channel Interactive

On July 12, 2013, a federal judge denied a motion filed by The Weather Channel Interactive to dismiss a number of trade secret misappropriation claims brought by Events Media Network, Inc. The judge held that the plaintiff had alleged sufficient facts to make out a claim under the Georgia Trade Secrets Act.

Events Media Network, Inc. (EMNI) and The Weather Channel Interactive (TWCI) entered into a license agreement under which EMNI provided TWCI access to a database of upcoming events and attractions. EMNI continually updated the database with event information drawn from publicly available sources. The license agreement allowed TWCI to use the database to serve local event listings to its website viewers.

EMNI alleged that its database was a trade secret under the Georgia Trade Secrets Act, and that TWCI had misappropriated this trade secret by using the database for purposes not included in the license agreement, such as building maps and developing new weather services. After the case was removed to federal court, EMNI filed an amended complaint and TWCI moved to dismiss the trade secret misappropriation claims on February 25, 2013.

TWCI asserted two main arguments in support of its motion to dismiss. First, it contended that EMNI’s database was not a trade secret because the information contained therein was publicly available. Second, TWCI argued that EMNI did not take reasonable efforts under the circumstances to protect the database’s secrecy. On July 12, 2013, Judge Robert Kugler in the United States District Court for the District of New Jersey denied the motion to dismiss, addressing both of TWCI’s arguments.

Value derived from secrecy:
Even though individual event listings contained in the database were publicly available, the court held that the database could still derive benefit from its secrecy. The court noted that EMNI “has created a business out of compiling public information into easy-to-use databases that it licenses to others for a fee,” and that demonstrating the success of this business model was sufficient to show that the database derived economic value from its secrecy.

Reasonable Efforts:

Although no individual TWCI employees had signed confidentiality agreements with EMNI, a provision of the license agreement required general confidentiality between the parties, and required TWCI to report any improper use of the database to EMNI. The court held that these provisions were reasonable efforts under the circumstances for EMNI to maintain the secrecy of its database.

Takeaways:

While this case only addresses a motion to dismiss, the decision provides strong support for companies that make a business of compiling and licensing access to otherwise public information. The court re-asserted that a combination of wholly public elements can still constitute a trade secret if there is value in the compilation, and that a general license agreement between companies can constitute a reasonable way to keep information secret.