Avid accuses California business of unfair competition

Protecting intellectual property and trade secrets is a key to continued success for many California businesses. Threats of illegal use of intellectual property can come from multiple directions, and business owners should have a legal team that is prepared to handle an intellectual property dispute on numerous fronts.

Avid Technology, maker of the widely used audio editing software Pro Tools, has brought a lawsuit against Media Gobbler, a California company that Avid claims could illegally use trade secrets gleaned from four former Avid employees. Those employees, whom the suit does not name as defendants, had signed nondisclosure and noncompete agreements with Avid.

Specifically, Avid claims that Media Gobbler, having hired away the employees, is now in a position to unfairly compete. The suit claims that Media Gobbler tortiously interfered with the former employees' contractual obligations to Avid, and that Media Gobbler's alleged unfair competition violates federal law.

The dispute dates back to August 2012, when Media Gobbler, which operates a file-sharing service for musicians, started licensing the rights to a software development kit produced by Avid. The point was to make Avid's products available through Media Gobbler's file-sharing platform.

The suit acknowledges that Media Gobbler had properly licensed the technology from Avid. However, Avid announced its plan to start its own file-sharing service, and the licensing agreement between the companies was cancelled, according to the complaint.

Avid claims that, after the arrangement was cancelled, Media Gobbler "recruited and hired four Avid employees" who had been with the company for more than a decade. The suit goes on to say that Media Gobbler's promotional materials continue to suggest the existence of a business relationship between the two companies when no such relationship exists.

You can find more on this case here.

For more on intellectual property matters, please visit our business law website.

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