Intellectual Property: Federal CFFA Statute Does Not Allow For Recovery of Routine Litigation Expenses, But Does Allow For Attorney’s Fees Recovery Relating To Investigation And Recovery Of Losses

Unpublished 2/5 DCA Decision So Found.

            Instant InfoSystems, Inc. v. Open Text, Inc., Case No. B297123 (2d Dist., Div. 5 Apr. 20, 2021) (unpublished) involved, among others, a claim under the Computer Fraud and Abuse Act (CFFA) (18 U.S.C. § 1030), which principally focuses on computer intrusions (such as hacking).  CFAA does have some very specific loss requirements.  The 2/5 DCA reminded us that (1) routine litigation expenses, as such, do not satisfy CFAA’s “loss” requirement (Mintz v. Mark Bertelstein and Associates, Inc., 906 F. Supp.2d 1017, 1029 (C.D. Cal. 2012); Brooks v. AM Resorts, LLC, 954 F. Supp.2d 331, 332 (E.D. Pa. 2013); and (2) attorney’s fees associated with investigating a computer hacking intrusion, responding to an offense, or negotiating with defendants are recoverable under CFAA (Facebook, Inc. v. Power Ventures, Inc., 252 F. Supp.3d 765, 777 (N.D. Cal. 2017).