In a groundbreaking decision with significant implications for businesses operating in digital asset markets, luxury goods, and experiential entertainment, Judge Pamela K. Chen of the Eastern District of New York has become the first federal judge to recognize a musical work as a protectable trade secret under the Defend Trade Secrets Act (DTSA).1 The September 25, 2025 ruling in PleasrDAO v. Shkreli expands trade secret protection beyond traditional business information to encompass unique cultural assets whose value derives from exclusivity.
Key Takeaways
- Musical works and cultural artifacts can qualify as trade secrets if their economic value derives from secrecy itself rather than eventual commercial exploitation
- Exclusivity-based business models can receive trade secret protection with proper contractual and security measures
- Trade secret claims can coexist with copyright protection when focused on maintaining confidentiality rather than preventing reproduction
- Forfeiture orders and asset transfers create ongoing obligations that, if violated, may constitute trade secret misappropriation
The Case
PleasrDAO, a decentralized autonomous organization, purchased Wu-Tang Clan's one-of-a-kind album "Once Upon a Time in Shaolin" for $4.75 million in 2021 after the government seized it from Martin Shkreli following his securities fraud conviction. The album, deliberately created as a single copy with an 88-year prohibition on commercial exploitation, came with strict contractual restrictions designed to preserve its uniqueness.
Despite being required to surrender all copies as part of his criminal forfeiture, Shkreli retained digital copies and publicly livestreamed portions to thousands of listeners. He also claimed to have distributed copies widely and threatened to release the album via torrent. PleasrDAO sued under the DTSA, among other claims, seeking to protect the album's exclusivity PleasrDAO did not pursue copyright infringement or breach of contract claims against Shkreli—traditional legal avenues for enforcing the rights at issue—likely because Shkreli, during his period of ownership, held a limited right to copy "Once Upon a Time in Shaolin," and there was no direct contract between PleasrDAO and Shkreli. This left a gap in the law which PleasrDAO sought to fill with its trade secrets claim.
Judge Chen's Analysis
Expanding Trade Secret Definition
Judge Chen confronted precedent that music cannot constitute a trade secret. Federal courts...
