Friday, April 17, 2009

Traverse Internet Law Federal Court Report: March 2009 Hacking Lawsuits

The facts are unproven allegations of the Plaintiff and all commentary is based upon the allegations, the truthfulness and accuracy of which are likely in dispute.

FILED: 3/09/2009

In this case the Defendants are alleged to have, in effect, hijacked the Plaintiff’s website and maintained it under its own name while terminating all Internet access by the Plaintiff. These types of situations are often extremely complicated in terms of the rights, responsibilities, and obligations of the parties. While giving up a percentage of a business is an occasionally attractive option when an online website is launching, it is extremely high risk and if the website becomes highly successful expect to have these types of problems. The best advice is to avoid “equity partnership” type deals with key service providers.

The Plaintiff is the owner and provider of an online social networking interactive website. Defendants are individuals who are running a competing website but originally started out as the webhost and in a technical support capacity for the Plaintiff’s website. The services were provided and exchanged for a 5 percent equity stake in the Plaintiff’s business. The lawsuit alleges that the Defendants unlawfully and without authorization terminated Internet access to the Plaintiff’s website and thereafter refused to allow the Plaintiff to access its own proprietary data and computer systems.

The lawsuit alleges trademark and trade dress infringement, trespass, trespass to channel, intentional interference with contract, breach of contract, violation of the Federal Computer Fraud and Abuse Act, and violation of a state of Connecticut computer crime statute. The prayer for relief includes a request for the entry of preliminary and permanent injunction, an award against the Defendants for actual damages, compensatory damages, punitive damages, interest, cost, and attorneys’ fees. Traverse Internet Law Cross-Reference Number 1304.