Missouri Federal Court Denies Summary Judgment Motion Finding Disputed Issue On Whether Trade Secret Exists Notwithstanding Lack of Confidentiality Agreements and Partial Disclosure to Copyright Office

Three years after entering into an oral subscription agreement relating to a specially designed, copyrighted internet-based computer software program, the subscriber stopped paying the required monthly fees.  The reason, according to a 10-count federal court complaint, is that the subscriber modified the source code by copying it onto the subscriber’s own server and thereafter used the unauthorized version.  This allegedly constituted, among other misconduct, breach of contract (Count VII), copyright infringement (Count VIII), and a violation of the Missouri Uniform Trade Secrets Act (Count IX).  The subscriber moved for summary judgment with respect to the trade secrets misappropriation count because (a) the source code had been disclosed to two of the plaintiff’s employees neither of whom had signed confidentiality agreements, and (b) it had been partially revealed to the U.S. Copyright Office.  A similar motion was filed concerning the alleged breach of contract which the subscriber contended was preempted by the Copyright Act and, consequently, was encompassed within Count VIII.  As explained below, both motions were denied. 

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