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Auto Downloading OK if Other Methods Allowed by Website Terms

(January 9, 2018) Using automated tools to download data from a website contrary to the site’s terms of use does not violate state computer abuse laws if the downloading of the data is otherwise permitted, the Ninth Circuit found.

The appellate court reversed a jury’s finding that Oracle USA, Inc. was entitled to $14.4 million in damages from Rimini Street, Inc. for violating California’s and Nevada’s computer abuse laws that prohibit the unauthorized access to a computer. Oracle’s website terms of use specifically prohibited the use of “automated means” to access its site and download software updates. Oracle argued that Rimini’s downloading was without permission. Rimini, which provides third-party support for Oracle’s products, used automated tools to access Oracle’s website and software.

“We hold that taking data using a method prohibited by the applicable terms of use, when the taking itself generally is permitted does not violate” either the California or Nevada computer abuse acts, the appellate opinion stated. “Oracle obviously disapproved of the method—automated downloading—by which Rimini took Oracle’s proprietary information. But the key to the state statutes is whether Rimini was authorized in the first instance to take and use the information that it downloaded.” Because Rimini had such authorization “Rimini did not violate the state statutes.”

The computer abuse action was part of a copyright infringement lawsuit by Oracle. Rimini downloaded Oracle software as part of a service agreement with Oracle customers to keep their Oracle programs updated. But Rimini also used the downloaded software not only for a specific Oracle customer but also for soliciting other Oracle customers to use their service. The jury found that the customer’s licenses with Oracle did not allow third-party access to the Oracle software. The jury awarded Oracle $35.6 million in damages for copyright infringement to which the court added $22.5 million for prejudgment interest and $3.2 million in costs. The court also awarded $28.5 million in attorneys’ fees, but remanded the calculation of attorneys’ fees in light of the reversal of the computer fraud findings.

Oracle USA, Inc., v Rimini Street, Inc., Nine Cir. No. 16,16832 and 16-16905, issued January 8, 2018

 

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