Use of propriety information sparks employment litigation

For most New Jersey residents who decide to leave a job in order to take a new one, the transition goes smoothly. That is not always the case. Take, for example, an employee whose actions shortly before he resigned sparked employment litigation.

The case focuses on the former employee, a project director at the company, who allegedly downloaded proprietary data from the company's computers a short time before he quit. The company claims that he used that data, which allegedly included details on pending projects and pricing terms, in order to secure business for his next employer.

Following the alleged use of the proprietary information, the company sued the former employee. In its suit, the company alleged violations of nine state laws as well as the Computer Fraud and Abuse Act, a decades-old federal anti-hacking statute.

The court hearing the case ultimately rejected the company's novel use of the CFAA. In rejecting the CFAA claim, the court noted that the law was meant to punish external hackers who accessed computers without authorization, not to go after employees who had authorization to access information at the time they accessed it.

Though the ruling was a setback for companies trying to prosecute suspected rogue insiders, it does not close the door entirely on future CFAA claims. The case hinged on the wording of the company's use and access policy. Tighter wording, such as explicitly making it illegal to access company data for the benefit of outsiders, may re-open the door to a future CFAA claim.

The case highlights the importance of carefully drafting employment documents such as employment contracts, noncompete agreements and confidentiality agreements.

Source: Computerworld, "Worker had proper access when he snagged corporate data, court rules," Jaikumar Vijayan, Sept. 6, 2012


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