A New York federal judge recently allowed a plaintiff to assert that Once Upon a Time in Shaolin, that one-of-a-kind, highly restricted Wu-Tang album, could be a trade secret.[1]
Historically, courts have rejected trade secret claims over unreleased musical works (e.g. unreleased recordings of Prince or Janet Jackson) on the theory that music is essentially meant to be heard, and costless secrecy is just a temporary business tactic until commercial release.[2] In other words, if the secret was going to be released soon anyway, it is functionally just a copyright claim in waiting.
While this ruling is unusual, so too is the background of Shaolin: to start, the album is not intended for release until October 8, 2103. Judge Chen emphasized both the distant public release date and the fact that Wu-Tang produced only a single copy of the album to distinguish Shaolin as “qualitatively different” from other unreleased music in previous jurisprudence. Here, secrecy was not merely a cradle before release. Instead, secrecy was baked into the album’s entire value. The album was designed to be secret and exclusive for an extended period of time; a significant part of its worth is derived from not being published. Indeed, Wu-Tang intended the album to be secret in part as a protest of the devaluation of musical expression in the digital age.[3] Thus, the court reasoned, it is proper to treat it under trade secret doctrine because it meets the classic trade secret elements: independent economic value from secrecy and reasonable efforts to maintain secrecy.
To be clear, the court didn’t yet affirm it is a trade secret, but it let the claim survive motion practice.
Although a bit avant garde, the position is relatively defensible.
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Trade secret protection and copyright protection are not mutually exclusive.
“If you allow trade secret for music, won’t that conflict with copyright doctrine or preempt it?” Not necessarily. Most courts hold that trade secret claims demand an additional showing (proof of a confidential relationship, misappropriation, breach of duty, etc.) beyond copyright claims such that federal copyright law often does not preempt a trade secret claim.[4] The presence of a valid copyright does not necessarily bar trade secret protection if the other elements are met. Indeed, when it comes to software, another work of authorship traditionally protected by copyright law, trade secrets have become the dominant form of protection, so the analogy is apt. If...
