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paulsutter

My first instinct is to congratulate Shred for standing up to the big bully. That was really almost what I posted.

But pick apart Shred's note, and really it's an emotional appeal based on two ideas:

1. That the sole test of stealing ideas is source code that has been copied verbatim.

2. That the only possible secrets of Smule are features implemented in released products.

These are pretty weak legs to stand on. They're actually preposterous.

Lawyers will tell you that it's really hard to prove theft in court without a smoking gun like "stolen source code", and the chances are, if they've stolen ideas in other ways, they will probably get away with it.

Almost certainly, Shred's lawyers are playing a key strategy role in this PR campaign.

So my advice is to be wary of emotional appeals from either side of litigation. We don't know what happened, and we learn less than we think from these notes.

ps. Yes I read the remarks in Business Insider too. I'm not advocating that Smule is the innocent party here. Most likely this is some bullshit pissing contest with 0 innocent parties.

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I appreciate this unbiased view. You're absolutely right that reading emotional appeals online is a slippery slope.

However, reading this Business Insider article about the case (http://www.businessinsider.com/smule-ceo-shred-video-lawsuit...) really underscores the apparent sleaze on Smule's side:

> You compare a 100-person company with 10, 30, 40 million dollars in the bank to a two-person startup. If it goes to litigation, if we're wrong, we'll win.

> Right? We'll win. We'll put a giant law firm on it and we'll do all of the discovery and we'll do all the depositions and we'll win. And if we're right, we'll still win.

Pretty much no matter how you slice it, saying "even if we're wrong, we'll win" because of money in the bank sounds pretty awful.

In other words,head we win,tail you loose,according to Jeff Smith.Sounds like a bully to me.

I wonder if it's possible to optimize the cost differential. (probably not for a 2 person startup, but maybe a little bigger). But once it's terminal, clear you can't win, just dump all the money into making lots of specific, esoteric claims that require Giant Law Firm to spend hundreds of hours researching and responding to.

Loser pays legal fees, but if i can get you to spend an order of magnitude or two more than my dying company is worth, well, that's the kind of flameout i could take some satisfaction in.

edit

Now that i think about it a bit, contacting the oppositions' customers and asking about their record retention policies seems like a great way to go. not a subpoena, just several repeated enquiries, an email, a letter, follow up with a phone call or two about about how do you store records, how many records might you have about opposition company, who are the employees who interact with the opposition company. Hit the VP's of HR, Accounting and whoever does legal.

You could probably get some really nice targeted facebook advertising for that set of people, "been scammed by x? call us"

Social engineering is scary.

In the US, the loser doesn't even always pay the legal fees. It depends.

Have you watched 'Halt and catch fire'?

The first or second episode sets up a legal battle, and the main character basically points out his company's staff lawyer to the opposition and says something to the effect of "We pay him $X, you can put hundreds of lawyers on this suit, we'll just have him."

Hi Paul thanks for your comments.

In the code comparison, the 3rd party will also be able to look at methods (in addition to code copied directly). We're more than happy to include proprietary methods in the review.

On stealing "ideas," do you have some advice here? Smule has never specified what ideas they think we stole. What do you think is our burden of responsibility in proving we did not steal ideas our opponents won't even specify?

"Ideas" isn't a form of IP that can be stolen. Did you patent anything? Have you appropriately protected these ideas to qualify for any sort of tradesecret protections?

(ps. Don't answer. This is the sort of thing to be discussed with an attorney behind a closed door.)

That's not quite accurate: "Ideas" cannot be patented or copyrighted, but they can be protected by contract.

The distinction is who the right to the idea is enforceable against. A patent represents a government enforced monopoly that bars anyone from using the specific intellectual property, whereas a contractual right to an idea can only be enforced against the other party to the agreement.

In California, the seminal case is the Supreme Court's decision in Desny v. Wilder, which held that a screenwriter could enforce a studio's promise not to use one of his ideas without his consent. The Court's reasoning was that while a party is free to come up with its own ideas, the disclosure of someone else's idea confers a benefit. Federal courts have addressed this issue a lot in a line of cases holding that Desny claims are not preempted by the Copyright Act.

I haven't been involved in any cases where the alleged theft of an idea involved an employment contract, but I see no reason why the same principles would not apply. Logically, an employer should be able to disclose propriety ideas to its employees without fear that they will be stolen, regardless of whether the ideas are sufficiently novel to qualify for an exclusive federal monopoly.

I said that ideas were not IP, not one of the recognized forms of intellectual property rights. Everyone is of course free to invent new concepts via contract, but that only creates obligations between the parties. Any dispute will be governed by contract law, not IP. Nobody outside the agreement will be bound.

The classic case in this area is Warner-Lambert v. Reynolds 178 F. Supp. 655 (1959). (It's about a contract covering the formula for Listerine)

http://law.justia.com/cases/federal/district-courts/FSupp/17...

Some "ideas" are, if they qualify as trade secrets (think Coke's formula). Other's are free to reverse engineer those ideas, but a former employer/vendor/customer exposed to those ideas under an NDA can come after you for misappropriating their qualifying ideas.

Coke's formula is not an "idea"

I've seen this kind of stunt before, in the SCO v. IBM lawsuit. Your defense is to get the court to require the other side to state specifically what they think you stole, or to drop the claim.

The law is on your side here. Vague claims aren't a part of a valid lawsuit. "Failure to state a claim actionable at law" may be the phrase you need.

But what you really need is lawyers, and IANAL.

Yes, thoughtful response, our lawyers are looking into this very strategy.

Unless it's part of your legal strategy, it's probably not advisable to discuss your strategy publicly, before or during legal proceedings.

> On stealing "ideas," do you have some advice here?

IANAL, and esp. I am not from the US so I don't really have a good grasp of the spirit of the law there (except that from the outside it is constantly surprising and scary!)

however, here in the UK i have some experience, esp because i want to ship software which directly competes with my previous employers in the future...

one thing to remember is that working somewhere enables you to gain knowledge about their workings and that the employer allows this at the time for its own benefit and not for yours.

its very difficult to prove/disprove if this happened though, and the contract signed when working there might turn out to be critical. whilst non-compete clauses are frequently so poorly written that they can never be enforced, the precedent here (in the UK) is that if you want to be safe and be able to point at past cases in defense then you do not compete for two years, poach employees, nor compete on your former employer's doorstep geographically. afaik there have been zero successful claims by employers if these criteria have been met...

remember this can be anything, from having beers on friday, to using a particular software for time-keeping - all the way through the the source code that you are so willing to allow to be searched. if you want better luck with this approach of being open - open every thing up, not just the code, but the working practices, software used, internal hierarchy, which cleaning company you use... everything.

on the other hand i know plenty of companies started by (naive) people who left and started immediately with their buddies from an old job and directly competed with their former employer within a year, using knowledge and skills that they improved on the job. they meant no harm and felt that what they were doing was fair, but imo they took an incredible risk by not researching what has happened in the past with such cases, and are lucky to have gotten away with it.

i hope this goes well for you. be ready for the media and naive readers to not read the detail of what has been written, and instead to slam you for nicking code to start up a company.

Thanks for your thoughtful comments.

Relevantly, Shred Video doesn't even compete directly with Smule for customers. Smule is building a network of karaoke singers and aspiring music enthusiasts to create music together. Shred Video is building technology to help athletes and adventure travelers make movies.

For example, it's unimaginable that a user would consider Smule apps and Shred Video to be competing substitutes that solve a similar need. She'd literally be choosing between "do I want to use this Smule app to sing karaoke songs or play guitar with, or do I want to use this Shred Video app to make a movie from my snowboarding footage?"

Why would you need to go to these lengths (waiting 2 years and competing in a different geogrpahical region)? What have you done wrong by making a competitor to your previous companies product? I ask this because I am thinking of doing something similar due to the fact that my employer is extremely incompetent. I am the only developer of a project that I helped take from no revenue to hundreds of thousands of dollars revenue but that should be making millions of dollars revenue. Unfortunately, I am micro-managed and often just have to implement the ridiculous ideas of my boss.

If I made a competitor, it would obviously share some of the same ideas as the current project. I mean, every social network has an "add friend" function, for example. Some things are just the right way to do things, or inherently part of the business domain.

If they started patenting all of my ideas, I would expect to actually be paid a decent salary.

<IANAL> It depends mostly on non-competing clause in your contract with them. Unless you steal their code (even if you wrote it, it's theirs!) I don't think they can sue you for using "their" ideas. </IANAL>

Ideas aren't property and can't be stolen or owned. Only implementations of ideas via copyright and patents are (and maybe should) be protected.

There is also the concept of a trade secret.

> On stealing "ideas," do you have some advice here? Smule has never specified what ideas they think we stole.

In their initial complaint filing [1] they mention "Synch Technology" (automated video/audio synchronization) several times.

"[...] specifically including the development of Smule's proprietary artificial intelligence technology that analyzes audio and video files and through the use of algorithms, automatically synchronizes video footage to audio files in a manner that results in a pleasing and and appropriate matching of the action and the music"

"[Shred] which purports to have developed a product that detects and segments key points of unstructured video and algorithmically synchronizes these videos to music in the same or similar manner as Smule's Synch Technology."

Some of the quotes and actions by your former boss leave a bad taste in my mouth, but if the AV synchronization is indeed similar to their own or developed using their resources, they will have a strong case that you've breached your contract.

[1] Found here, thanks to codingdave: http://webaccess.sftc.org/Scripts/Magic94/mgrqispi94.dll?APP...

lol @ preposterous. That's the law yo.

Copyright - Source code that has been copied. Patent - Monopoly on an idea. Trade Secret Law - N/A. They are former employees. Non Compete Agreement - Agreements in restraint of competititon are void in California.

Shred's story sounds credible to me. The fact that Smule offered to make this lawsuit go away in exchange for equity sounds a lot like extortion to me. Why would they settle for a % of a company when they already own 100% of the secret sauce that was stolen? If their claim is as baseless as this article [1] suggests, RICO or anti-SLAPP laws should definitely apply.

[1] https://blog.ycombinator.com/on-the-shred-video-lawsuit

>Trade Secret Law - N/A. They are former employees. Non Compete Agreement - Agreements in restraint of competititon are void in California.

I would respectfully disagree with these assertions. Trade Secret is not void just because someone is a former employee. You don't get to walk out the door with the secret recipes. And there are many exceptions to california's ban on non-compete agreements. Non-compete agreements are also very different than non-disclosure agreements.

You don't get to walk out the door with the secret recipes.

Indeed, but in general in the US you have to go to real efforts to create and keep secret such recipes. And I find it utterly amazing that California law, last time I checked, doesn't consider customer lists to be protectable trade secrets for salesmen (!!!).

I'm completely onboard with california on that one. Customer lists are not secret. Each and every customer knows they are a customer. Certainly the tax man knows who is an isn't a customer, along with any number of credit cards companies and banks that might process orders. So the alleged secret isn't really kept in-house.

This is SUPER wrong. Customer lists were one of the original trade secrets under common law, and they still are trade secrets--as long as they're kept secret.

More modern applications:

"Business Information Trade secrets in this category may include: ... Customer lists" http://www.fenwick.com/FenwickDocuments/Trade_Secrets_Protec...

"California court affirms that customer lists can qualify as trade secrets" http://www.lexology.com/library/detail.aspx?g=ea22e316-7210-...

The case you cited in your last link could have been decided after I read whatever it was I read. It could be that it's pretty hard to make and keep such lists as trade secrets, or maybe what I read referred to just a list of customers with all that other information, but I remember it being pretty definitive, and, generally agreeing with your initial points, startling.

The law of customer lists being trade secrets is literally centuries old.

Perhaps you're remembering a recent case about whether LinkedIn contacts could qualify as trade secrets, which tested where to draw the line:

http://blogs.orrick.com/trade-secrets-watch/2014/10/27/new-s...

No. The tradition is old. The law has been revisited and updates many hundreds of time.

Um. That "old" "tradition" is binding law until it's overruled. It hasn't been.

Again, here are the current California trade secrets statutes:

http://leginfo.legislature.ca.gov/faces/codes_displayText.xh...

Lol, accepting your 'tradition' argument (I don't) any such traditions would be overturned by the very statute you cite.

"3426.8.This title shall be applied and construed to effectuate its general purpose to make uniform the law with respect to the subject of this title among states enacting it."

That's the law. It overturns everything prior. All commonlaw interpretations (the closest legal thing to tradition) before it are void in the face of this new law.

Fyi. California's law is actual a cut-and-past of the Uniform Trade Secrets Act as adopted by basically every other state in the union. See https://en.wikipedia.org/wiki/Uniform_Trade_Secrets_Act.

I admit, my attention was divided earlier between Hacker News and my day job as a California IP litigator.

Here you go:

Yes, the UTSA statute is "the law". But it's not the ONLY law. Where there are gaps, courts look to case law, just like in any other area of law. And the UTSA was drafted with the old common law in mind, continuing much of it, but codifying it. That's why courts DO look at the older common law to inform their interpretations of the UTSA.

This is from page 1 of the Prefatory Note in the 1985 final draft of the UTSA:

"The Uniform Act codifies the basic principles of common law trade secret protection, preserving its essential distinctions from patent law."

With that, I'm done with this thread. We are way off-topic since the lawsuit in the original post doesn't even have a trade secret claim. I'm also done dispensing free legal advice for the night.

Note the words "can qualify" and "may include". It's not a matter of secret keeping. It is a fact-specific analysis turning on the nature of the product and the specific information on the list. Whether or not one could theoretically gather the information from public sources, sources outside the list, is also a factor. A simple list of buyers for a simple product may not qualify regardless of attempted protections. Not all lists are protected. Imho, given the various rules, I would say the default in California is still non-protection absent exceptional circumstances.

I totally dismiss the linked Fenwick PFD. According to my pdf reader that document was last updated on "Tue 05 Apr 2005 04:49:08 PM PDT". It's totally out of date and therefore untrustworthy as to specifics of current CA law. I'm a little shocked that it is still on their server.

California trade secrets law has not changed drastically since 2005. If you have actual information to the contrary, by all means, point to it.

You're correct that there's more to it than just keeping something secret:

- It has to also be valuable because of the secrecy, so the number I'm thinking in my head doesn't count. But customer lists typically do have value because of secrecy.

- Trade secrecy can be destroyed if the secret gets out.

There's no reason to argue in the abstract. Here's how California law actually defines "trade secret" -- Civil Code 3426.1(d):

(d) “Trade secret” means information, including a formula, pattern, compilation, program, device, method, technique, or process, that:

(1) Derives independent economic value, actual or potential, from not being generally known to the public or to other persons who can obtain economic value from its disclosure or use; and

(2) Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

http://leginfo.legislature.ca.gov/faces/codes_displayText.xh...

I said the document was untrustworthy, not necessarily incorrect. It is too old to be relied upon. It's not a question of whether the material is accurate. Any lawyer advising a client would be negligent if he or she looked to such dated summaries of the law. They aren't worth reading given the many current summaries are available elsewhere. Now if the firm wants to reissue the document, then perhaps.

Well, good thing you're not my client. :)

Just want to point out that Smule has not cited trade secret theft as a claim against us.

And on non-compete, Mark and I were just employees, not officers of any sort. Neither of us was a manager with direct reports.

There are two ways to 'win' a civil suit. Counter their allegations, or assert your own counterclaims. It may be possible to assert that they have taken your trade secrets.

Talk to lawyers. In offices. Not online. Sign a client agreement. Pay them money. Beyond that, you cannot get any reliable advice from anyone here.

There's also the "run out the clock" method, i.e. drain the other company of money, energy, time, etc.

Which appears to be exactly the worst case the plaintiff is imaging per the words he was rather unwise to utter in an all hands meeting (http://www.businessinsider.com/smule-ceo-shred-video-lawsuit...):

[...]

And here's the sad truth. You compare a 100-person company with 10, 30, 40 million dollars in the bank to a two-person startup. If it goes to litigation, if we're wrong, we'll win.

Right? We'll win. We'll put a giant law firm on it and we'll do all of the discovery and we'll do all the depositions and we'll win. And if we're right, we'll still win....

(Note: discovery can be very expensive, and depositions tend to take a lot of time in preparation and the actual deposition.)

Which suggests the defendant isn't entirely insane to try to win this in the court of public opinion, a worst case apparently not imagined heretofore.

There was no "misappropriation" here. Employment does not qualify as "improper means". [1]

Just imagine for a moment the slippery slope this would create if companies were able to criminalize knowledge on the basis of prior employment. Literally any work process you performed could be considered protected IP. You could work one job and never be employable again.

[1] https://en.wikipedia.org/wiki/Uniform_Trade_Secrets_Act

Yes. That is reality. Talk to anyone in aerospace. Techniques developed for employer A cannot be taken to employer B. I'm not saying it doesn't happen, just that there are laws on the books to prevent it.

Imagine the slippery slope if former employees of Coke were allowed to take the recipe over to Pepsi. We wouldn't have any long-lived product lines. (That actually happened. Pepsi called the FBI)

For below: 18 U.S. Code § 1832 - Theft of trade secrets (the really really short version)

"Whoever ... knowingly ... steals, or without authorization appropriates ... or by fraud, artifice, or deception obtains such information ... shall ... be fined under this title or imprisoned not more than 10 years, or both."

What laws?

sandworm101: That's a really interesting comment. It sounds very anti free market to me, but I guess I'm not surprised. I guess the only recourse for a founder led company in that situation would be to leave the US. Not necessarily a great result.

OT: Regarding the Coke/Pepsi thing, personally I think food manufacturers (I use the term loosely) should be forced to disclose what's in their products. Though I would strongly agree that this comment has nothing to do with the rest of our previous discussion.

Leaving the US would do little beyond increasing the cost of litigation and making said founder look more like a fugitive. Tradesecret law and IP law generally is pretty universal. And you can still get sued where the alleged theft/taking/wrong took place. A default decision (ie you don't show up) by a US court will be enforced in Canada, Europe or most anywhere else.

As for free markets, while IP law does create monopolies, the theory is that many protected innovations would never be brought to market without some promise they won't be replicated.

For below: Independent creation is not theft and so the laws do not apply. Copyright and patent bar independent creation, but not tradesecret. No doubt countless production secrets have been independently developed by competitors. When one trys to patent something, these come out of the woodwork as "prior art". But independence is a very hard burden to prove. Any communication from one firm to another, especially the movie a knowledgeable employee from one firm to the other, destroys any notion of independence.

sandworm101: do you think those laws apply when someone reinvents something that was in their head, or only when documents were retained/copied/passed as in the Chung/Boeing case?

It sounds like you agree with me then. Techniques developed for employer A CAN be taken to employer B. [as long as they are independently created ]

If there is some nuance here that I'm missing, I'd like to know what it is. A finer understanding of this point is probably really important for anyone who works in science.

No they cannot be 'taken' from A to B. They must arise independently within in B. The fact B's technique looks very much like A's must be complete coincidence.

> A default decision (ie you don't show up) by a US court will be enforced in Canada, Europe or most anywhere else.

Russia and China will be more than happy to take your IP :)

For 'eternal' products like Coke I guess it's impossible, but for other still moving markets I thought a simple N-years NDA clause was enough to let ex-employee not screw you until you have enough head start.

In the case of your Coke vs. Pepsi scenario, would the recipe for Coke not be protected both as a trade secret, and under copyright?

On the other hand, I can't believe it'd be against the law for some employees from Coke to quit and start a company that manufactures soda (assuming they didn't actually use Coke's recipe).

But that's exactly how it works. I have worked at a company that did a "clean room" reimplementation of a competitor's product. You cannot have anyone who was formerly an employee of the other company anywhere near a project like that. It's not that you will be prosecuted as a criminal, it's so that your company has some defense against being sued.

https://en.wikipedia.org/wiki/Clean_room_design

Trade secrets are indeed protected under California law yo.

http://www.nolo.com/legal-encyclopedia/california-trade-secr...

- "California is unique in that its laws expressly establish that the employer owns trade secrets created by an employee (Cal. Labor Code Sec. 2860)."

- "Federal rules also apply in California. The Economic Espionage Act of 1996 makes the theft of trade secrets a federal crime."

Patents do not offer a monopoly on an idea. They offer protection of an invention a process a machine, but not an idea.

Or a bareknuckled way to take 10% of a company, or even just a signal to intimidate current employees.

I worked for a small ($30-$50m annual revenue) company sued by a giant ($47B annual revenue) company. The goal, which worked, was to drain my employer's bank accounts on $5+m of legal expenses per year to keep a superior but less expensive product out of market.

It's fair to plead for people not to read to much into this. But your suggestion that this is a "bullshit pissing contest with 0 innocent parties" seems ridiculous to me, given that a well funded company is suing a less funded company it doesn't compete with. You think that is the most likely scenario? Really??

It certainly seems like a reach to just assume bad behavior on both ends.

Which actually, is one of the more insidious outcomes of making absurd claims against someone, even if they're completely false. People naturally respond "well, no one would be crazy enough to make something like that up, so there must be some truth to it."

Most likely this is some bullshit pissing contest with 0 innocent parties.

Pissing contests do not usually include one willing and one unwilling participant. Shred's note is not just an emotional appeal because if they did steal ideas, it is an open invitation for Smule to state what they are.

> if they've stolen ideas in other ways

How can ideas be stolen? They're not property. Source code is. Patents are. Ideas are not.

If Smule had explicit plants to do exactly what Shred is doing and the Shred people left specifically to exploit that idea on their own, then maybe they might have a case appealing to trade secrets or something. But if Shred is doing something different that just happens to also be related to video and music, but does that in a different way, not using any of Smule's algorithms, I don't see how they can possibly have a case.

Unless, of course, you accept that employers own the work experience of their employees. I'm sure some would wish to.

Wow, this is a really informed comment.

To add to this, as a software engineer, while thinking through Smule's AutoRap app and the Shred Video app, I couldn't help but think that they could both probably benefit from a similar method for detecting (or synching with) beats, chorus, etc. Even though this sort of audio posterization (I'm not sure what it's really called) is not entirely novel, it's probably a reasonably tough problem to solve. If I had to guess, I'd guess that this aspect is what Smule's case is based on.

FTR: I hope Shred Video wins, because, based on the Business Insider article linked herein, Smith seems to be, IMHO, a huge bully.

Don't you think this will be absolved with a review of Shred Video's code/methods vs Smule's code/methods? And isn't it telling that Shred Video is more than willing to submit to such a review, but Smule has not yet acquiesced?

That doesn't seem telling to me, because Smule is probably just listening to their lawyers. And their lawyers are probably advising them to just wait for court. That seems like the right strategy for Smule regardless of the facts of the case.

What do you mean by "right strategy" in this sense? Doing a 3rd party review of Shred vs Smule code/methods will give them a trove of relevant information if they intend to win on the merits.

In my understanding, refusing it is only the "right strategy" if your intent is to not have the case go to trial.

Exactly. Regardless of whether they are right or wrong, if their goal is just to win this case, it doesn't seem like it's in their best interests to have the case go to trial, if they think they'll win before a trial.

Try another point of view. If this review was done outside the case, then it would very likely have to be re-done later IN the case with expert witnesses who are disclosed to the other side through the formal discovery process. It's not crazy to want to avoid duplicating that cost. Also, they can challenge Shred's expert in court if they don't like who you pick.

And...I saw the court filings...you have a lawyer...stop talking to randos on HN for advice. :)

How can you steal an idea? There is little to no protection for ideas. More tangible information may have a lot of protection, but ideas are more-or-less fair game.

I'm not a lawyer, but as I understand it, if you're under non disclosure, somebody shares an idea with you, and you use it, then you've stolen an idea. Or, if the idea is patented.

Enforcement could be another issue, depending on evidence.

You also can't patent ideas.

Non-disclosure is just a form of contract. It doesn't itself protect ideas from theft. If they are valuable enough, or if the contract is not enforceable, then the person can still walk away with the material. They need to look to tradesecret law, that is IF any of their code qualifies for tradesecret protection.

The big if is in the relevant code: "(d) Trade secret means information, including a formula, pattern, compilation, program, device, method, technique, or process, that (2) Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy."

http://www.leginfo.ca.gov/cgi-bin/displaycode?file=3426-3426...

That's probably not even close to true. Without wading into the morass of what an "idea" is, a boilerplate employee agreement might list things like:

technical information, methods, processes, formulae, compositions, systems, techniques, inventions, machines, computer programs, research, business information, customer lists, pricing data, sources of supply, financial data, and marketing, production, or merchandising systems or plans

If your employer is working with a concept or idea and can tangibly tie it to anything like these (or any of a similar list of "artifacts") that employees had access to, then it's very dangerous for employees to start their own firms based on those concepts or ideas.

(I have no idea what's going on with Smule/Shred! Shred sounds very credible right now.)

All of those are more tangible than "ideas."

IANAL, but here's an example:

"It would be cool to make an app that does X" <-- not likely protected

"Our marketing research shows that there is a $3B market for an app that does X" <-- likely protected, but needs some requirements to be a trade secret.

[edit]

Also, many states allow enforcement of non-compete agreements, and in some cases that may include areas the company is planning on entering at the time of your employ.

Almost all states enforce noncompetes, not that it's clear to me what noncompetes have to do with this.

I think you should talk to a lawyer before making assessments about how unlikely it is something is to be protected. Generally: safest course is to assume it is protectable.

I talked to a lawyer before starting this company and I was very surprised by how many pitfalls I hadn't even considered.

California doesn't enforce noncompetes, which is what matters in this case.

California does enforce non-compete agreements, there are just restrictions.

Did I miss where this was a non-compete case? I thought the accusation was IP theft.

@aidenn0 > "Our marketing research shows that there is a $3B market for an app that does X" <-- likely protected. ----- I don't see how even that would or should be protected.

Covered under "business information" in the boilerplate that tptacek posted.

Yes, in legalese those would be considered trade secrets. Tellingly, Smule did not name "theft of trade secrets" as a claim in their lawsuit.

Reading stories from parties to litigation is like listening to a couple that just broke up discuss whose fault it was. You gotta read between the lines.

Of course, if one member in a couple has $40 million dollars and the other does not, and the rich one files a lawsuit against the other without even first talking to her, one might consider that the two are not equally culpable parties.

Didn't mean to imply anything about your particular situation. Just a meta-point. Litigants rarely think they're in the wrong--they view the situation through the lens of their personal narratives of what happened.

It's also really hard to prove the absence of theft, e.g., of things like trade secrets in strategy, customer lists, and financial models. The consequence is that even if you're in the right, you can spend several hundred thousand on legal fees before you can get out of a case.

"source code that has been copied verbatim."

There are tools that will detect source code with similar but not identical structure.

Lexicographic analysis, I think it's called. Back at university, they would run checks against the byte-code (Java, woo) to find people who were sharing their source. Caught a few people out in the earlier years who thought changing variable names was enough to avoid plagiarism.

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