SalesForce – Salesforce Sued for Breach of Contract for Disclosing Information to Third Parties Without Consent
Plaintiffs GA Telesis LLC and Constant Aviation LLC filed a complaint on Thursday in the Northern District of California against Salesforce.com Inc. alleging that the defendant breached their contract by disclosing information to third-parties without their authorization or consent.
GA Telesis and Constant Aviation asserted that under Salesforce’s Master Subscription Agreement and Non-Disclosure Agreements (collectively, the Agreements), Salesforce “agrees to protect the confidential and proprietary information of its clients, and further agrees not to provide its clients’ confidential and proprietary information to any third-party, unless compelled by law or unless authorized by its clients to do so.” However, despite the terms of the Agreements, Salesforce has purportedly “engaged in the unfair and deceptive business practice of taking its clients’ confidential and proprietary information, manipulating that information, creating inaccurate ‘use cases’ and then giving to third-parties and other potential purchasers those ‘use cases’ those ‘use cases’ on which they rely to make purchasing decisions.” Reportedly, Salesforce gives this information to third parties to demonstrate the “‘successful’ implementation” of its products and services “as applied to the businesses of others in similar industries.”
Nevertheless, the plaintiffs contended that the “use cases” violate their Agreements with Salesforce, infringe their intellectual property, and contain false information. For example, Salesforce allegedly claims in some “use cases” that its clients are using products and services that “are not actually being used.” The plaintiffs added that in other circumstances, the “use cases” included the tradenames and logos of clients, purportedly implying the accuracy as well as the consent and disclosure of this information; however, this is also false. Additionally, GA Telesis and Constant Aviation proffered that Salesforce’s “use cases” also contain trade secret information to third parties or potential Salesforce customers without the plaintiffs’ or trade secret owner’s consent.
According to the plaintiffs, since Salesforce creates the “use cases” it “knows the false information contained therein and knows that (it) lacks authorization to display and transmit its clients’ information in the manner presented.” However, oftentimes, Salesforce purportedly omits and fails to disclose the existence of these “use cases.” Therefore, the plaintiffs and other Salesforce customers do not know about this conduct and could not take measures to protect themselves. GA Telesis and Constant Aviation alleged that Salesforce’s conduct is “brazen, willful and malicious.”
The causes of action include: violation of Defend Trade Secrets Act, violation of California Uniform Trade Secrets Act, breach of contract, and unfair competition.
The plaintiffs seek declaratory judgment in their favor; an award for damages, costs, and fees; prejudgment interest; a preliminary and permanent injunction; and other relief.
GA Telesis and Constant Aviation are represented by Akerman LLP.