Friday, June 22, 2012

Dilated Media, LLC Sues Yahoo! in Trade Secrets Litigation

Trade secrets litigators may wish to pay attention to a recent trade secrets lawsuit filed by a California Internet marketing company, Dilated Media, LLC, against Yahoo.  The suit concerns Yahoo allegedly allowing third party access to Dilated Media's user accounts hosted by Yahoo.  The accessed data allegedly contained Dilated's pay per click strategies and records.  This type of data is often protected under various state trade secrets statutes despite residing upon third party servers (in this case, Yahoo).  Dilated alleges that a deal to sell this valuable Internet marketing data was severely compromised, leading to a large price reduction for the eventual purchaser.  In Internet marketing litigation, it gets tricky to value such data - particularly without multiple good faith offers.  Nonetheless, if successful, Internet service providers like Yahoo may see an increase in claims and liability.