Judge rules state trade secret law trumps First Amendment

• A California trial judge refused to quash a subpoena to an Internet service provider intended to discover the confidential sources of Web sites that published “trade secrets.”

March 11, 2005 — A San Jose, California, trial judge today ruled that a state trade secret law trumps the First Amendment, refusing to quash a subpoena aimed at discovering the confidential sources of three Web sites that published alleged “trade secrets.”

Judge James P. Kleinberg ruled that “the United States and California Supreme Courts have underscored that trade secret laws apply to everyone regardless of their status, title or chosen profession. The California Legislature has not carved out any exception to these statutes for journalists, bloggers or anyone else.”

Apple Computer, Inc. filed a lawsuit Dec. 13, 2004, against unnamed “Doe” defendants after three Web sites devoted to Apple products — O’Grady’s PowerPage, Apple Insider and Think Secret — reported the impending release of new Apple products and posted confidential Apple documents on the Internet before that information had been released to the public. Apple also sued Think Secret and its owner, Nick Ciarelli, in a separate lawsuit.

Apple questioned employees with access to the leaked information, but not under oath.

On November 4, Apple served a subpoena on Powerpage’s Internet service provider, Nfox, in order to obtain email communications between Powerpage and its confidential source. Powerpage and owner Jason O’Grady, Apple Insider and pseudonymous owner “Kasper Jade,” and Apple Insider host Monish Bhatia filed a motion to quash the subpoena as a violation of California’s shield law and the First Amendment.

Kleinberg denied the motion, making the comparison to a “fence” of stolen property.

“Whether he fits the definition of a journalist, reporter, blogger, or anything else need not be decided at this juncture for this fundamental reason: there is no license conferred on anyone to violate valid criminal laws,” he wrote.

Kleinberg stayed the subpoena until March 22 to allow the Web sites to appeal.

(Apple Computer, Inc. v. Doe, Media Counsel: Kurt Opsahl, Electronic Frontier Foundation, San Francisco) — GP

© 2005 The Reporters Committee for Freedom of the Press

Return to: RCFP Home; News Page