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United States: New Hampshire Federal Court Interprets The Computer Fraud And Abuse Act More Narrowly Than Massachusetts Federal Court And Dismisses Claims Based On Violations Of Computer Use Restrictions
A recent case from the U.S. District Court for the District of
New Hampshire highlights the split between the District of
New Hampshire and the District of Massachusetts over the proper
interpretation of the Computer Fraud and Abuse Act (CFAA), 18 U.S.C. § 1030, in particular the phrase
"exceeds authorized access." Under various provisions of
the CFAA, an individual can be liable if certain conditions are met
for exceeding his or her authorized access to information in a
computer. The District of New Hampshire has taken a narrower view
of "exceeds authorized access," concluding that the
phrase does not include violations of computer use restrictions (as
opposed to computer access restrictions). The District of
Massachusetts, on the other hand, has taken a broader view, ruling
that an individual can be liable for misusing another's
confidential information, even when the individual was permitted to
access that information. Both courts, as trial courts within the
First Circuit, had to contend with the appellate decision EF Cultural Travel BV v. Explorica, Inc.
to draw their respective conclusions.
In the New Hampshire case, the court determined that the Ninth
Circuit's decision in
United States v. Nosal (which I've written about
here) was persuasive and that the First Circuit's decision
in Explorica was really about exceeding authorized access
rather than exceeding authorized use. In that case, the defendant
used a "scraper tool" to obtain pricing data from a
competitor's website and used confidential information obtained
from a former employee of the competitor in violation of the
employee's confidentiality agreement with the competitor to do
so. The First Circuit held that the defendant likely violated the
CFAA by exceeding its authorized access to the website. The New
Hampshire court determined that the Explorica decision was
better understood as focusing on the unauthorized access
to the website gained by the defendant rather than the
defendant's unauthorized use of the website. Because
certain of the defendants in the New Hampshire case allegedly only
violated computer use restrictions, the New Hampshire court granted
summary judgment for them.
But as I've previously
written, the District of Massachusetts has interpreted the
Explorica case differently, focusing on the First
Circuit's statement "that the former employees'
reliance on [plaintiff]'s pricing information reeked of
use—and indeed, abuse—of proprietary
information that goes beyond any authorized use of
[plaintiff]'s website." This is language from
Explorica that the District of New Hampshire decided was
"dicta," i.e., language that is not binding on lower
courts. Yet the District of Massachusetts concluded that
Explorica shows that the First Circuit "advocated a
broader reading" of the CFAA than the Ninth Circuit.
It's easy to see how the CFAA could affect an employee who
leaves his employer and takes information with him, and these cases
show the difficulties federal courts have faced interpreting the
CFAA and how it might apply to employees. Even district courts
within the same circuit, interpreting the same case, have come to
competing conclusions. With the Solicitor General's recent
decision not to pursue review of the Nosal decision by
the Supreme Court, where authoritative guidance for all the
circuits might have been produced, the difficulties are likely to
continue in the foreseeable future.
To view Foley Hoag's Massachusetts Noncompete Law
Blog please click
here
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