In its opinion, the court noted the complicated and “tangled” issues of the intellectual property law that this case addressed. However, the opinion does not do much, if anything, to untangle the complicated web of copyright and trade secrets law by the end of its decision. In fact, the decision’s foundation is laid on shaky grounds, with limited authority and questionable analysis. The Eleventh Circuit seemingly fashioned a means to an end, allowing recovery for Compulife despite a lack of precedential law for recovery under both the Florida Uniform Trade Secrets Act (“FUTSA”) and the Uniform Trade Secrets Act (“UTSA”).
Compulife Software concerned the “scraping” of publicly available life insurance quotes by a hacker using a bot to proliferate quotes by way of a computer software program. By using this software-run “bot,” the hacker was able to generate a substantial number of individual quotes, merging the data to create a database of these quotes. Plaintiff’s allege the resulting database created was protectable under trade secret law.
Without relying on any authority regarding bots scraping data, the court found that is scraped database was protectable as a trade secret, despite the public availability of the quotes and deeming the manner of access inconsequential to the trade secret analysis. However, while this conclusion may have been appropriate had the Plaintiff brought a claim under the CFAA, trade secret law would not provide the remedy here, clearly evidenced by the lack of authoritative foundation cited by the court.
Possibly even more concerning is the faulty analysis of “improper means” and its application to bots scraping data. Defendants used bots to scrape every possible combination of demographic data, amounting to more than 42 million quotes. The court notes that it would have taken thousands of man-hours what took the bot only four days to accomplish. In the analysis on improper means, the court relies heavily on the 1970 decision of duPont deNemours & Co. v. Christopher, 431 F.2d 1012 (5th Cir. 1970), rarely cited for this principle, in which the defendants were liable for misappropriation of trade secrets despite no illegal activity or breach of contract or relationship, and Physician’s Interactive v. Lathian Sys., Inc., No. CA 03-1193-A, 2003 WL 2301820, at *8 – 16 (E.D.Va. Dec. 5, 2003), under which the hacking of the computer system was done without authority in order to obtain confidential information.
The foundation upon which the Eleventh Circuit has rested its decision – that data scraped from a publicly available site could be a trade secret and that the list of improper means under FUTSA and UTSA is inexhaustive, is shaky, at best. Both Parties and courts should be wary of the weak foundation in applying this opinion to cases involving publicly available website information.