LVRC Holdings LLC v. Brekka

Raj PagariyaCase Summary

Termination of authorised access when an employee acts against the employer's interests

LVRC Holdings LLC v. Brekka
581 F.3d 1127
In the United States Court of Appeals for the Ninth Circuit
Case Number 07-17116
Before Circuit Judge M.M. McKeown, Circuit Judge S.S. Ikuta, and District Judge J.V. Selna
Decided on September 15, 2009

Relevancy of the Case: Termination of authorised access when an employee acts against the employer’s interests

Statutes and Provisions Involved

  • The Computer Fraud and Abuse Act, 18 U.S.C. § 1030

Relevant Facts of the Case

  • The plaintiff filed a lawsuit against its former employee, Christopher Brekka, his wife, and the couple’s two consulting businesses, namely EBSN and EBSF. Brekka is the first defendant in the present case, while his wife is the third defendant.
  • In the lawsuit before the district court, the plaintiff alleged that Brekka violated Section 1030 of CFAA by accessing its computer without authorisation, both during his employment and after he left the company. The district court granted summary judgment in the defendants’ favour.
  • The plaintiff operates a residential treatment centre for addicted persons in Nevada. LCRV retained LOAD, Inc. to provide email, website, and related services for the facility. LOAD also monitored the internet traffic to the plaintiff’s website.
  • In April 2003, the plaintiff hired the first defendant to conduct internet marketing programs and interact with LOAD. At this time, he owned and operated his two consulting businesses that obtained referrals for addiction rehabilitation services and provided referrals of potential patients to rehabilitation facilities through internet sites and advertisements. The plaintiff company’s owner was aware of the first defendant’s businesses; however, he did not know the full nature of their operations.
  • During his employment, he frequently travelled between Florida and Nevada. EBSF is based in Florida, while EBSN is based in Nevada. His home was also in Florida, while his workplace was the plaintiff’s rehabilitation centre in Nevada.
  • While the plaintiff had assigned a computer to him, he emailed documents in connection with his work for LVRC to his personal computer. LVRC and Brekka did not have a written agreement. Moreover, there were no employee guidelines prohibiting employees from emailing LVRC documents to their personal computers.
  • In August 2003, the plaintiff and the first defendant started discussions regarding the possibility of him purchasing an ownership interest in LVRC. However, these discussions broke down, and the first defendant left the plaintiff’s company. During these discussions, he emailed various documents, such as financial statements, marketing budgets, and admissions reports, among others, to his personal and his wife’s email addresses.
  • In November 2004, LOAD discovered that the first defendant’s username was logged in to the LVRC’s website. LVRC filed a report with the FBI alleging that he had unlawfully logged into its website. Thereafter, the plaintiff brought an action against the defendants before the District Court.

Prominent Arguments by the Counsels

  • The plaintiff’s counsel contended that the district court erred in assuming Brekka’s access was authorised. Since he used this access to further his own personal interests, it was an access without authorisation for the purposes of Sections 1030(a)(2) and 1030(a)(4).
  • The defendant’s counsel submitted that at least two employees of the plaintiff had access to his computer after he left the company. There is a direct possibility that they could have used his credentials to login to the plaintiff’s website. Moreover, the location derived from the IP address gives the address of an internet service provider and not the user’s exact location.

Opinion of the Bench

  • No language in CFAA supports the plaintiff’s argument that authorisation to use a computer ceases when an employee resolves to use the computer contrary to the employer’s interest.
  • The court was not in favour of interpreting the provisions of CFAA, as done in the case of International Airport Centres LLC v. Jacob Citrin.
  • There is not enough evidence upon which a reasonable jury could find that he violated CFAA after he left the company.

Final Decision

  • The Court of Appeals affirmed the district court’s summary judgment.