Dice Corp. v. Bold Technologies

556 F. App'x 378
CourtCourt of Appeals for the Sixth Circuit
DecidedJanuary 24, 2014
Docket12-2513, 13-1712
StatusUnpublished
Cited by20 cases

This text of 556 F. App'x 378 (Dice Corp. v. Bold Technologies) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Dice Corp. v. Bold Technologies, 556 F. App'x 378 (6th Cir. 2014).

Opinion

JULIA SMITH GIBBONS, Circuit Judge.

Plaintiff-appellant Dice Corporation and defendant-appellee Bold Technologies are competitors that provide services and license software to companies in the alarm industry. Dice claims that Bold committed a host of intellectual property violations when converting one of Dice’s former customers to its systems. The district court granted Bold’s motion for summary judgment on all of Dice’s claims and denied Dice’s motions for reconsideration and indicative ruling. For the following reasons, we affirm.

I.

A.

Dice Corporation and Bold Technologies are in the same business — both license software to companies in the alarm industry. Alarm companies monitor signals sent from their respective subscribers’ alarm systems. When an alarm signal is tripped, the alarm company contacts the appropriate authorities such as the police or fire department. Alarm companies collect an impressive amount of data. The data typically consists of names, addresses, contact information, billing information, and information regarding the type and location of alarms. As a general matter, both companies’ software monitors alarm signals and compiles information in databases. Dice’s software is known as Dice software; Bold’s is licensed under the trade name Manitou.

Despite providing similar services, the technical features of their software are significantly different. By way of quick background, computers operate in a binary number system: 0 for off and 1 for on. Current computers are capable only of executing functions based on this basic language consisting of strings of l’s and 0’s. This is known as object code. Computer programming languages — such as C+ + and Thoroughbred Basic — facilitate human programming by obviating the need for programmers to write in cumbersome object code. The text of these languages is known as source code. Whether directly or indirectly, the instructions written in source code are ultimately translated into object code so that commands can be executed by the computer. See generally Universal City Studios, Inc. v. Reimerdes, 111 F.Supp.2d 294, 305 (S.D.N.Y.2000). Dice software is written using the programming language Thoroughbred Basic and runs on the Linux operating system. Manitou is written in the C++ and Visual Basic languages and runs on the Windows operating system.

B.

This dispute stems from a customer defection. ESC Central was a Dice custom *380 er for a decade. In 2011, it transitioned to Bold. Switching software systems is no easy task. The conversion process must be undertaken carefully because the alarm company continues to monitor alarm signals from its subscribers. The transition must be seamless to ensure that the new software is interpreting the incoming alarm signal in the same manner as the old so that no alarm signals are misread or missed. As Bold’s chief of operations explained:

After the customer data is extracted and converted, there will be a period of time, usually about 3 months when the customer’s central station is running live on the old software, but the new software is running in parallel on different servers. The purpose of running the two software systems in parallel is to ensure that the new software is monitoring the alarm signals consistent with the old software. After this period is completed the customer will go live on the new software and will often terminate its license for the old software.

Following this protocol, Bold first extracted ESC Central customer data from Dice’s software databases. This data— names, addresses, etc. — is owned by ESC Central and not by Dice. Matt Narowski, a current Bold employee and former Dice employee, wrote the computer program (“Extraction Program”) used to extract customer data from Dice’s database. He explained that he wrote the program using information available to the public together with general knowledge of computer programming; he did not read, review, copy, or rely upon any information about Dice source or object code; the Extraction Program does not contain any Dice source or object code; and, since being employed at Bold, he has not seen a copy of Dice source or object code. And he explained that “the database files where the customer data is stored are not subject to any Dice security features and can be accessed by anyone who has a copy of Thoroughbred Basic, which Bold licensed from that company.”

Not so, says Dice. Dice maintains that Bold used and copied Dice’s proprietary software in operating the Extraction Program. Clifford Dice stated that he “analyzed the conversion program created by” Narowski and concluded that “[t]he program which Bold has created for converting information belonging to Dice customers cannot operate without access to Dice software and the source code contained within that software.”

C.

Following extraction, the Bold and Dice software systems were run in parallel from June 2011 to August 2011. Although not aware at the time that ESC Central was converting to Bold’s Manitou, Dice subsequently became aware through Facebook activity by ESC Central’s vice president, Kristi Harris Jennings. Immediately thereafter, Dice’s Director of Software Development, Julie Coppens, logged into the ESC Central system. She found that someone had accessed Dice’s ALSCHART file. Coppens testified that although ESC Central had disconnected Dice, it had not removed access to a phone connection. ESC Central described this as “illegal entering,” and sent a cease and desist letter, threatening suit if Dice did it again. Dice, on numerous occasions, admitted that it has no evidence that it was anyone at Bold who accessed the file.

The ALSCHART is a file containing a master list or database of alarm codes. Manufacturers code 1 outgoing alarm sig *381 nals to identify the type of emergency. For example, a fire signal may be coded “F” by one company and “1” by another. The alarm panel sends these signals to receivers at alarm companies where the information is converted into Dice’s standard and compiled in the ALSCHART, a part of Dice’s software. Dice’s receiver-drivers software performs the conversion from manufacturers’ signals to Dice’s standard. Dice contends that the ALSCHART and its receiver drivers are proprietary. According to Dice, its standards are unique.

D.

On December 5, 2011, Dice filed its operative complaint in the Eastern District of Michigan. Dice asserted claims under Michigan’s Uniform Trade Secrets Act (“MUTSA”), Mich. Comp. Laws §§ 445.1901-1910, the Copyright Act, 17 U.S.C. § 106, the Digital Millennium Copyright Act (“DMCA”), 17 U.S.C. § 1201 et seq., and the Computer Fraud and Abuse Act (“CFAA”), 18 U.S.C. § 1080.

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Bluebook (online)
556 F. App'x 378, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dice-corp-v-bold-technologies-ca6-2014.