Emergency Info

Morrison | Foerster

Japan
Japan
China
China
Europe Israel
Hebrew
SEARCH

About the Firm Practices and Industries Attorneys & Professionals Careers Legal Updates and News Events
Legal Updates and News
Overview
Legal Updates
Press Releases
In The News


Related Practices:

California Supreme Court Rules That Free Speech Protection Does Not Prevent Injunction Against Publishing Trade Secrets
September 2003

On August 25, 2003 the California Supreme Court issued its decision in DVD Copy Control Association, Inc. v. Bunner, 2003 Cal. LEXIS 6295 (Cal. Aug. 25, 2003). The subject of the case was Mr. Bunner's posting on his web site of a computer program that allows users to circumvent the copy protection on DVDs. The Supreme Court decision holds that courts may order a person to remove trade secret information from a web site without violating the free speech protections of the United States and California Constitutions. The case was closely watched because the Court of Appeal had held that computer code posted by Bunner was "pure speech" and warranted the highest level of protection under Bunner's free speech rights. DVD Copy Control Association v. Bunner, 93 Cal. App. 4th 648 (2001). The Court of Appeal had ruled that Mr. Bunner's publication of the program could not be enjoined even though it was created by misappropriation of trade secrets. The Court of Appeal decision thus raised the possibility that it would become difficult or even impossible for companies to prevent publication of their confidential information by someone who might obtain it improperly. By overruling the Court of Appeal's decision, the California Supreme Court confirmed that publication of trade secret information may properly be enjoined, in appropriate circumstances, without violating free speech protections.

The underlying case concerned the publication of the software known as DeCSS, which allows a user to defeat the copy protection known as CSS on some DVDs. DeCSS was developed by a Norwegian teenager named Jon Johansen, who posted the code on a web site. Mr. Bunner then posted the DeCSS code on his own web site, as did many other web site operators around the world. The DVD CCA, which owns CSS, sued Bunner and other defendants, claiming that they misappropriated the DVD CCA's trade secrets by posting the DeCSS computer program on their websites. The Superior Court issued an order preventing the defendants from continuing to post the DeCSS code on their sites. The injunction was then overturned by the Court of Appeal.

It is not clear from the court record how (or whether) Mr. Johansen developed DeCSS. For the purposes of the appeal, however, the California Supreme Court assumed that he developed DeCSS, and that he did so by misappropriating trade secrets. The Court further assumed that Mr. Bunner misappropriated trade secrets.

The Court agreed that computer code is protected by the First Amendment to the United States Constitution, as well as the similar rights in the California Constitution. However, the Court held that those provisions do not always prevent injunctions from being entered. The Court found that protection of trade secrets depends "on the judiciary's power to enjoin disclosures by those who know or have reason to know of their misappropriation." The Court also found that "the injunction burdens no more speech than necessary to serve the government's important interest in maintaining commercial ethics." The Court therefore reversed the Court of Appeal.

Although the DVD CCA won this battle, it may yet lose the war. The Supreme Court sent the case back to the Court of Appeal with instructions to determine whether or not the record supports the claim that a trade secret was misappropriated. There is very little in the record about how Mr. Johansen created DeCSS, so the DVD CCA may not be able to show that he or Mr. Bunner misappropriated trade secrets. Moreover, it is generally agreed that the DeCSS code has proliferated throughout the internet. It would not be surprising if the Court of Appeal finds that there is no trade secret misappropriation, and overturns the injunction on that basis.

Other DeCSS Cases

Bunner is one of several notable cases that DeCSS has spawned. In Pavlovich v. Superior Court, 29 Cal. 4th 262 (2002) the California Supreme Court declined to allow a California Superior Court to exercise jurisdiction over a defendant who posted the DeCSS code to a web site in another state, but otherwise had no connections to California. The case is significant because it means that jurisdiction in California state courts requires something more than a web site that is accessible from California. In Universal City Studios, Inc. v. Corley, 273 F. 3d 429 (2d Cir. 2001), the Second Circuit upheld an injunction issued under the Digital Millennium Copyright Act to prevent the posting of the DeCSS code to a web site. The injunction in Corley also barred the defendants from including links on their web sites to other sites on which DeCSS was posted. The injunction in Bunner, by contrast, specifically did not include a prohibition on linking.