Apple Computer V. Doe - Case Study

Apple has two lawsuits pending that involve rumor-tracking Web sites. In Apple Computer v. Doe No. 1, et al. (or Apple v. Does for short), the company is suing up to 25 unnamed individuals for misappropriation of trade secrets--specifically, leaking Apple's confidential information about an unreleased audio product code-named "Asteroid" to Think Secret, AppleInsider, and Jason O'Grady's PowerPage.

As part of the discovery process, Apple obtained subpoenas for all three sites for any and all information related to "Asteroid," including the identity of all people who leaked the information, or communications that might reveal said identities. None of the sites is a defendant in the Does suit, though Apple has made clear that they could be named as defendants if evidence shows that they knowingly published Apple's trade secrets (and Think Secret is a defendant in a second lawsuit not related to "Asteroid").

Both Think Secret and AppleInsider have their own e-mail service, so obtaining information about their e-mail records and messages would require subpoenaing the sites themselves, invoking difficulties about journalist privileges. When Apple learned that PowerPage used an external e-mail provider, the company's legal team found its path of least resistance. Nfox has gone beyond refusal to contest the subpoena--the ISP refused to promise O'Grady that it would not comply with the subpoena before appeals were exhausted. That's when the Electronic Frontier Foundation, representing the three sites, went to court seeking a protective order on O'Grady's behalf to prevent Nfox from turning over the information to Apple.

On March 4, lawyers for Apple and for the three subpoenaed sites met in the San Jose courtroom of Superior Court Judge James P. Kleinberg. They were arguing over the sites' motion for a protective order barring Nfox from honoring Apple's subpoenas. It was an uphill battle, because one day earlier, Judge Kleinberg tentatively ruled in Apple's favor.

On March 11, the Judge formalized his preliminary decision, denying the motion for the protective order, leaving Nfox free to honor Apple's subpoenas and turn over all information from O'Grady's e-mail related to "Asteroid," including that which may identify the person who sent it to the sites. In the 13-page ruling, Kleinberg essentially told the three sites (the ones who moved to have the subpoenas quashed, hence their reference as movants in the decision) that their status as journalists does not matter--if they had Pulitzer Prizes, they'd still have to honor the subpoenas.

Trade Secrets

The law in question--one that nearly all the heated coverage of Apple's lawsuits has managed to ignore--is the California Uniform Trade Secrets Act, or UTSA. California is one of seven states that adopted the 1979 version of UTSA drafted by the National Conference of Commissions on Uniform State Laws. Thirty-seven other states and the District of Columbia adopted the amended 1985 version, and it's pending in the 2005 New Jersey legislature. Only New Jersey, Massachusetts, North Carolina, New York, Texas, and Wyoming don't have the UTSA in state law.

Common