United States District Court, W.D. Texas, Austin Division
PITMAN UNITED STATES DISTRICT JUDGE
the Court is Plaintiff BidPrime, LLC's
(“BidPrime”) Motion for Entry of a Temporary
Restraining Order and to Set a Hearing on Plaintiff's
Motion for a Preliminary Injunction, (Dkt. 3), and the
parties' responsive briefing. On June 12, 2018, the
parties participated in a hearing on BidPrime's motion.
After considering the motion, the supporting evidence, and
the relevant law, the Court finds that the motion should be
is a Texas company that uses its proprietary software to
monitor and aggregate real-time requests for proposals, bids,
and contracts issued by public and private entities in the
United States and Canada. (Compl., Dkt. 1, at ¶¶
12-13). BidPrime's service is designed to reduce the
amount of time that its customers would need to spend
searching for bids themselves. (Id. ¶¶
13-14). BidPrime developed the software that it uses to
monitor, collect, and store information about bid requests.
(Id. ¶ 17). BidPrime also developed the
software that customers use to search and view information
about the bid requests that the company monitors and
collects. (Id.). BidPrime operates a closed website
that allows registered users to view the bid requests that
the company collects. (Id. ¶¶ 14-16).
SmartProcure, Inc., d/b/a GovSpend
(“SmartProcure”) is “one of BidPrime's
largest competitors.” (Id. ¶ 23).
Defendant Jeffrey Rubenstein (“Rubenstein”) is
SmartProcure's President, CEO, and founder; Defendant
Marc DiGeronimo (“DiGeronimo”) is
SmartProcure's Director of Sales. (Id.
¶¶ 4-5). According to BidPrime, SmartProcure
offered to buy unlimited access to BidPrime's website and
proprietary database in 2017. (Schwartzbeck Decl., Pl.'s
Ex. A, Dkt. 4-1, ¶ 18). During negotiations, Rubenstein
signed up for a free trial to access BidPrime.com, which
ended when negotiations stalled in November 2017.
(Id. ¶¶ 19-22).
months later, Rubenstein and DiGeronimo accessed
BidPrime's website on a number of occasions through the
accounts of two SmartProcure customers and an account
registered to a fake identity created by DiGeronimo.
(Rubenstein Decl., Defs.' Ex. A, Dkt. 11-3, ¶¶
14-20). When accessing BidPrime's website, Defendants
both manually and automatically-using software called
“bots”-obtained large quantities of bid data.
(Id. ¶ 15; Schwartzbeck Decl., Pl.'s Ex. A,
Dkt. 4-1, ¶¶ 29-42). Altogether, BidPrime estimates
that Defendants obtained data related to 52, 175 bid
requests. (Schwartzbeck Decl., Pl.'s Ex. A, Dkt. 4-1,
basis of these allegations, BidPrime asserts causes of action
against Defendants for (1) violations of the Computer Fraud
and Abuse Act, 18 U.S.C. § 1030 (“CFAA”);
(2) violations of the Stored Communications Act, 18 U.S.C.
§§ 2701, 2707 (“SCA”); (3) violations
of the Texas Harmful Access by Computer Act, Tex. Civ. Prac.
& Rem. Code §§ 143.001 et seq.
(“THACA”); (4) violations of the Texas Uniform
Trade Secrets Act, Tex. Civ. Prac. & Rem. Code
§§ 134A.001 et seq. (“TUTSA”);
(5) common law misappropriation of trade secret information;
(6) violations of the Texas Theft Liability Act, Tex. Civ.
Prac. & Rem. Code §§ 134.001 et seq.;
(7) conversion; (8) trespass to chattels; (9) breach of
contract; (10) unjust enrichment; and (11) civil conspiracy.
(Id. at 18-30).
same day it filed its complaint, BidPrime filed this motion
for a temporary restraining order (“TRO”), in
which it asks the Court to enjoin Defendants from accessing
BidPrime's website without authorization, using
information contained on BidPrime's website, or deleting
information from SmartProcure's computers that might be
evidence relevant to this action. (Mot. TRO, Dkt. 3, at 2-4).
BidPrime only bases its request for a TRO on its CFAA, THACA,
breach of contract, and misappropriation of trade secrets
claims. (Mem. Supp. Mot. TRO, Dkt. 4, at 16).
party moving for a TRO must establish that: “(1) there
is a substantial likelihood that the movant will prevail on
the merits; (2) there is a substantial threat that
irreparable harm will result if the injunction is not
granted; (3) the threatened injury outweighs the threatened
harm to the defendant; and (4) the granting of the [TRO] will
not disserve the public interest.” Clark v.
Prichard, 812 F.2d 991, 993 (5th Cir. 1987). “A
[TRO] is an extraordinary remedy and should only be granted
if the plaintiffs have clearly carried the burden of
persuasion on all four requirements.” Nichols v.
Alcatel USA, Inc., 532 F.3d 364, 372 (5th Cir. 2008)
(citation and quotation marks). Upon reviewing BidPrime's
motion, the Court concludes that BidPrime has failed to
demonstrate (1) a substantial likelihood that it will prevail
on the merits of its trade secrets claims, or (2) that
irreparable harm will likely result if an injunction is not
granted on the basis of BidPrime's CFAA, THACA, or breach
of contract claims.
Misappropriation of Trade Secrets
argues that the Court should enter a TRO on the basis of its
trade secret misappropriation claims. (Mem. Supp. Mot. TRO,
Dkt. 4, at 24-27). The Court finds that a TRO is not
warranted on the basis of these claims because BidPrime has
failed to show a substantial likelihood of success on the
merits of these claims at this stage in the litigation.
establish trade secret misappropriation in Texas, a plaintiff
must show “(a) the existence of a trade secret; (b) a
breach of a confidential relationship or improper discovery
of the trade secret; (c) use of the trade secret; and (d)
damages.” Daniels Health Scis., L.L.C. v. Vascular
Health Scis., L.L.C., 710 F.3d 579, 583 (5th Cir. 2013).
Although public information cannot be a trade secret, a
combination of public information can, in certain
circumstances, be a trade secret. Id. However, to
qualify as a trade secret, the owner of that combination of