X Company, which operates Twitter, sent a cease-and-desist (C&D) letter to Meta threatening to sue following the launch of Threads. Here’s what’s inside…
💌 The Letter
Semafor’s Max Tabi published a letter that was sent to Meta by Alex Spiri, legal counsel for Twitter / X Company. You can download or view it below.
The letter, which mixes both C&D demands and notice that X Company is planning to file a lawsuit, alleges that Threads by Instagram, Meta’s Twitter competitor platform, was built off the back of Twitter’s IP by way of former Twitter employees Meta hired after Elon Musk fired over half the company after taking ownership.
The letter claims “systematic, willful, and unlawful misappropriation of Twitter’s trade secrets and intellectual property.”
Twitter is claiming Meta specifically assigned former Twitter employees to work in Threads, which was developed “in a matter of months,” according to the letter.
The letter is also being used to put Meta on notice regarding Twitter’s planned litigation efforts, and that Meta must preserve documents in advance of litigation and discovery.
The letter also states that Meta is prohibited from scraping Twitter services to crawl for any user data or content.
Read the article over on Semafor 👉 https://www.semafor.com/article/07/06/2023/twitter-is-threatening-to-sue-meta-over-threads
🤓 What It Means
So what does this mean? In order to prove misappropriation of trade secrets, it’s a fairly high bar. Here’s an analysis under the federal Defend Trade Secrets Act (DTSA)
FIRST 🔒 How do you have a trade secret?
Twitter has an obligation, created by the definition, to take “reasonable measures” to maintain the secrecy of the information. Having a clear, documented method in place for protecting data is a key element to taking advantage of trade secret protection.
First, companies should have access controls and policies that limit who is able to access or use the materials that are intended to remain secret and protected.
Second, employers should have confidentiality agreements for both employees and contractors that explicitly protect the valuable trade secrets of the company.
Third, documented security controls should be in place that prevent unauthorized disclosure, access, or use of the trade secret.
🤔 Do we think all of that was in place? Maybe?
SECOND 🔒 Next, Twitter will need to prove that Meta had any such unauthorized disclosure, access, or use of the trade secret(s).
This is where the former employees come into play, as well as the documents and devices that are mentioned.
THIRD 🔒 Damage to Twitter, which I think we’re seeing is happening, to a degree. But, that’ll be something that has to be proven along with the other two items above.
📋 There’s also the potential issue for any former employees who left Twitter and went to Meta to now be potentially dragged into this issue, whether they like it or not. And, my guess is that this will get nasty. It’s also interesting if non-compete agreements come into play (perhaps what Twitter’s letter refers to as “ongoing obligations”)
It’s also funny to note that on Twitter’s Open Source site, they state:
“Twitter has been built on open source since the beginning. Openness is part of our DNA.”
Not to mention Musk released the recommendation algorithm (to a degree) recently.
Update (4:57pm ET) – Elon Musk has confirmed the letter via a tweet: