In the highest-profile case filed to date under the recently enacted Defend Trade Secrets Act, Space Data has accused Alphabet and Google of misappropriation of trade secrets in the launch of their balloon-based wireless network code named Project Loon, in a complaint filed in the U.S. District Court for the Northern District of California.
Space Data alleges that Google and it engaged in discussions and negotiations concerning Google’s possible acquisition of shares or assets of Space Data in 2007. Later, in February 2008, Space Data provided Google with access to confidential and trade secret information, including business concepts for the use of balloons to provide wireless service. According to Space Data, Google then abruptly cut off further discussions later in the month.
A Google subsidiary, now named “X,” first tested Project Loon over New Zealand in 2013.
Space Data’s complaint includes claims for patent infringement and misappropriation of trade secrets under the DTSA and California state law. It includes allegations that Google’s misappropriations are ongoing.
The DTSA creates a federal cause of action for trade secret misappropriation. But the law only applies “to any misappropriation of a trade secret . . . for which any act occurs on or after the date of the enactment of this Act,” or May 11, 2016, when President Obama signed the law. The DTSA is unclear as to what constitutes such an “act” where the alleged misappropriation began before May 11 and purportedly remains ongoing.
The case is Space Data Corp. v. X, No. 16-cv-3260 (N.D. Cal.).