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Intellectual PropertyFeaturesContractsLitigationTrade SecretsTechnology Media and TelecomThe Intellectual Property Strategist

How Ticket Software Lost Trade Secret Protection

By Richard Raysman and Peter Brown

Trade secret protection applies only to confidential information. In almost all circumstances, broadcasting to the world the intricate details and applications of a trade secret extinguishes whatever “property right” an entertainment industry holder once possessed. What is a sufficient method of contractually notifying a software user of the trade secret status of certain information is a closer question.

According to a recent case from the U.S. District Court for the Southern District of New York involving live-event ticket sales, a purported holder of a trade secret cannot omit a confidentiality provision from its terms of use and then claim trade secret status afterward. Broker Genius v. Zalta, 17-cv-2099. In Broker Genius, the district court held that the inconspicuous language of the licensor's terms of use, coupled with its routine and frequent disclosure of the entire architecture of the user interface of the software supposedly protectable as a trade secret, precluded the licensor's successful motion for injunctive relief for trade secret misappropriation.

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