Card Isle Corp. v. Farid

689 F.Supp.3d 1273

CARD ISLE CORPORATION, Plaintiff, v. Tariq FARID, et al., Defendants.

CIVIL ACTION FILE NO. 1:21-CV-1971-TWT

United States District Court, N.D. Georgia, Atlanta Division

Signed August 30, 2023

Andrew L. Sandler, Pro Hac Vice, Christopher Leonard McCall, Pro Hac Vice, Mitchell Sandler, LLC, Washington, DC, Rebecca Anne Guiterman, Pro Hac Vice, Kropf Moseley PLLC, Washington, DC, Matthew Robert Rosenkoff, Taylor English Duma LLP, Atlanta, GA, for Plaintiff.

Jason James Carter, Eliza L. Taylor, Solesse Lane Altman, Bondurant Mixson & Elmore, LLP, Atlanta, GA, for Defendants.

OPINION AND ORDER

THOMAS W. THRASH, JR., United States District Judge

This is a case involving the alleged theft of trade secrets, copyright infringement, and breach of contract. It is before the Court on the Defendants' Motion for Summary Judgment [Doc. 129] and the Plaintiff's Motion for Partial Summary Judgment [Doc. 137]. For the following reasons, the Defendants' Motion for Summary Judgment [Doc. 129] is GRANTED in part and DENIED in part, and the Plaintiff's Motion for Partial Summary Judgment [Doc. 137] is DENIED.

I. Background

This case involves the alleged theft of intellectual property owned by the Plaintiff Card Isle Corporation. Card Isle is a small technology company that supplies online retailers with coding systems, infrastructure, and support to sell personalized greeting cards on their websites. (Pl.'s Statement of Undisputed Material Facts ¶ 1.) At a high level, Card Isle creates a customized block of source code that a retailer "plugs into" its existing e-commerce platform, allowing consumers to design, purchase, and print greeting cards without having to leave the retailer's website. (Id. ¶ 2.) It is standard practice to use integration code to import functions like the Card Isle greeting card product into a website. (Defs.' Statement of Undisputed Material Facts ¶ 13.) Often, this is accomplished through the use of an "iframe," a computer software tool which embeds content from one website into another website. (Pl.'s Statement of Undisputed Material Facts ¶ 2.) For example, an iframe may be configured to display YouTube videos on an otherwise unaffiliated website, thereby connecting the YouTube functionality to the other website. (Defs.' Statement of Undisputed Material Facts ¶ 13.)

To guide its client retailers through this integration process, Card Isle prepares an "E-Commerce Integration Blueprint" containing an explanation of the relevant components of Card Isle's technology and a unique block of code written for the specific retailer's website. (Pl.'s Statement of Undisputed Material Facts ¶ 3; Defs.' Statement of Undisputed Material Facts ¶¶ 32-33.) The retailer-specific block of code is the only change made to the retailer's code base, and it serves to load two JavaScript libraries onto the retailer's website: the "Card Isle Embed Library" and the "Retailer-Specific Library." (Pl.'s Statement of Undisputed Material Facts ¶¶ 5-6; Donato Dep. at 42:20-43:17.) The Card Isle Embed Library imports the generic functionality associated with Card Isle's product, including the iframe and the ability to select and personalize greeting cards. (Pl.'s Statement of Undisputed Material Facts ¶ 5; Donato Dep. at 44:1-7.) The Retailer-Specific Library is customized for each retailer and is designed to deliver a personalized user experience tailored to the retailer's website. (Pl.'s Statement of Undisputed Material Facts ¶ 6; Card Isle 30(b)(6) Dep. at 58:20-61:10.) Because it would be "unwieldy" to have a single file perform all of this functionality, Card Isle's JavaScript libraries are structured to import other libraries which in turn import still more libraries. (Pl.'s Statement of Undisputed Material Facts ¶ 10.) This structure is common in software coding. (Id.)

In order for a computer user to gain access to a particular website, some of the code for that website must run on the user's computer. (Id. ¶ 17.) Adam Donato, one of Card Isle's founders and its CEO, explained:

Whenever any piece of software is provided, the list of instructions are included in it. That list of instructions has to then be able to be interpreted by your computer to be able to use. If it can be interpreted by a computer, it can be interpreted by a human, because humans built the computers. So any time any piece of software is put out into the wild, it is possible to put some effort in and deconstruct it, and see what each of the steps are, what each of the instructions in the software is.

(Id.) Most web browsers have a set of "developer tools" that allow people to see the underlying code that is visually representing a website, usually written in the HTML, CSS, or JavaScript programming language. (Id. ¶ 18.) To protect the secrecy of its integration code and make it less readable to humans, Card Isle engages in obfuscation and minification of certain portions of the code. (Defs.' Resp. to Pl.'s Statement of Undisputed Material Facts ¶ 19.) In broad terms, obfuscation is a process that makes the names of variables irrelevant in source code, whereas minification removes comments and spaces in the source code to make it harder for humans to decipher. (Defs.' Statement of Undisputed Material Facts ¶¶ 65-66.) Although Card Isle obfuscates and minifies the retailer-specific block of code and the Card Isle Embed Library, it did not, at least in this case, perform these security measures on the Retailer-Specific Library. (Id. ¶¶ 69-70; Defs.' Resp. to Pl.'s Statement of Undisputed Material Facts ¶ 19; Defs.' Resp. to Pl.'s Statement of Additional Undisputed Material Facts ¶ 7.) Further, obfuscation and minification can only make it harder, but not impossible, to read and understand computer code. (Defs.' Statement of Undisputed Material Facts ¶ 67.)

On October 14, 2020, Card Isle obtained a copyright for its code base, referred to as "Code Base Version 3." (Card Isle 30(b)(6) Dep. at 68:21-69:20; id., Ex. 2 ¶ 35.) The copyright applies to Card Isle's retailer-specific block of code, the Card Isle Embed Library, and the Retailer-Specific Library. (Card Isle 30(b)(6) Dep. at 149:1-8.) In addition to its copyrighted code, Card Isle considers its technical know-how to be a valuable and unique part of the services it offers to retailers. (Pl.'s Statement of Undisputed Material Facts ¶ 12.) For example, David Henry, a founder and the COO of Card Isle, testified that Card Isle has "fairly complicated knowledge about printers, how they communicate with different devices, [and] how to connect them into a user friendly website experience[.]" (Id.) This knowledge allowed Card Isle to develop in-house software for tracking and elevating the performance of its retailers' inexpensive, consumer-grade printers. (Id. ¶¶ 13-14.) Card Isle also considers the combination of its problem-solving approach and its organization of individual pieces of technology to be one of its competitive advantages. (Pl.'s Statement of Additional Undisputed Material Facts ¶¶ 4-5.)

The events giving rise to this case began in the summer of 2019, when Card Isle began exploring a potential business relationship with Defendant Edible Arrangements, LLC and its founder Defendant Tariq Farid.¹ (Defs.' Statement of Undisputed Material Facts ¶ 120.) Edible Arrangements is a franchising business with approximately 1,000 stores that specialize in delivering fresh fruit arrangements and other food and gift items. (Id. ¶ 1.) At the time, Edible Arrangements provided customers a card with a customizable message with their orders; however, Card Isle's software promised to expand this capability, offering customers more traditional greeting cards that could be sold for an additional charge. (Id. ¶¶ 122-23.) Edible Arrangements ultimately hired Card Isle to integrate its software into Edible Arrangements' e-commerce platform and to roll out the greeting card product to a limited number of Edible Arrangements' franchisees. (Id. ¶ 124.)

The parties entered into three written contracts.² On May 20, 2019, Card Isle executed a non-disclosure agreement (the "Netsolace NDA") with Netsolace, Inc., a company which provides technology solutions to Edible Arrangements and other franchise businesses. (Id. ¶¶ 2, 127.) Farid was the sole owner of Netsolace during the parties' engagement. (Defs.' Resp. to Pl.'s Statement of Undisputed Material Facts ¶ 44.) Under section 2(c) of the Netsolace NDA, Netsolace agreed to use confidential information for the sole purpose of evaluating products and services in connection with its potential business relationship with Card Isle. (Pl.'s Statement of Undisputed Material Facts ¶ 46.) Except for this permissible purpose, Netsolace could not "use[ ], disclose[ ], reproduce[ ], summarize[ ], or distribute[ ]" confidential information. (Id.) Section 2(d) further provided that Netsolace "may not reverse engineer, decompile or disassemble any software disclosed to" it. (Id. ¶ 48.) On June 3, 2019, after executing the Netsolace NDA and a materially identical non-disclosure agreement with Edible Arrangements, Card Isle shared its E-Commerce Integration Blueprint with Edible Arrangements, containing a block of code written for Edible Arrangements' website and references to the Card Isle Embed Library and the Retailer-Specific Library. (Id. ¶¶ 56, 58; Defs.' Statement of Undisputed Material Facts ¶ 36.)

On October 10, 2019, Card Isle and Edible Arrangements entered into a services agreement (the "Services Agreement"), in which Card Isle agreed to provide the "infrastructure and support" for Edible Arrangements franchisees to "sell personalized products[.]" (Services Agreement, at 1.) Section 2(a) of the Services Agreement prohibited Edible Arrangements from using or divulging "non-public information regarding features, functionality and performance" of Card Isle's Service.³ (Id. ¶ 2(a).) Under section 1(a) of the Services Agreement, Edible Arrangements also agreed not to, "directly...