[Note: material in square brackets is commentary by Keith Henson] [this is the result of a scan, and contains many OCR errors] Thomas R. Hogan, SBN 042048 LAW OFFICES OF THOMAS R. HOGAN 60 South Market Street, Suite 1125 San Jose, California 95113-2332 (408) 292-7600 Roger M. Mugrim William M. Hart PAUL, HASTINGS, JANOFSKY & WALKER 399 Park Avenue Thirty-first floor New York, New York 10022-4697 (212) 318-6000 Helena K. Kobrin, SBN 152546 7629 Fulton Avenue North Hollywood, California 91605 (213) 960-1933 Attorneys for Plaintiff RELIGIOUS TECHNOLOGY CENTER UMTED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA RELIGIOUS TECHNOLOGY CENTER, a ) CASE NO. California non-profit corporation, ) ) EX PARTE APPLICATION FOR LEAVE Plaintiff, ) TO FILE EX PARTE APPLICATION OVER ) FIVE PAGES FOR TEMPORARY v. ) RESTRAIMNG ORDER, ORDER TO ) SHOW CAUSE RE: PRELIMINARY H. KEITH HENSON, an individual, Defendant. ) INJUNCTION, AND ORDER FOR ) EXPEDITED DISCOVERY ____________________________________________ TO THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA: Plaintiff seeks leave of this Court to submit and file an ex parte application and accompanying memorandum of points and authorities in excess of the five-page maximum permitted under Local Rule 7-11(b)(1). The expanded pages sought are in support of an application pursuant to Rule 65 of the Federal Rules of Civil Procedure, for a temporary restraining order ("TRO") and order to show cause re preliminary injunction, and order for expedited discovery, as set forth in the accompanying memorandum of points and authorities. Defendant has not been given notice of the instant motion, for fear that the notice thereof will bring about the very harm sought to be prevented by the underlying application for TRO. MEMORANDUM OF POINTS AND AUTHORITIES I - INTRODUCTION Plaintiff's *ex parte* application for a TRO addresses a serious issue of imminent harm to plaintiff's intellectual property, in the face of adamant threats by defendant to post plaintiff's trade secret materials to the Internet. However, the factual history and factual and legal issues involved are both extensive and complex. It is impossible for plaintiff meaningfully to address the issues and meet the factual and legal standards required by law in only five pages. II. GOOD CAUSE EXISTS FOR PERMITTING PLAINTIFF LEAVE TO FILE EX PARTE APPLICATION IN EXCESS OF 5 PAGES Keith Henson, who has already posted one of plaintiff's copyrighted, unpublished works and openly supported others sued by plaintiff for violation of its intellectual property rights, is now threatening to destroy plaintiff's trade secret rights in certain unpublished, copyrighted materials. He threatens to do so by soliciting copies of these materials, regardless of whether they are "stolen" or "illegal" copies. He has announced his intention to post any such wrongfully acquired materials to the Internet, openly states that he is doing so in spite of this Court's injunctive orders in Religious Technology Center v. Ward, No. C 96-20207 RMW, and regardless of the likelihood he will provoke plainfiff to sue him. In order to meet its burden of entitlement to a TRO, order to show cause regarding preliminary injunction, and order for expedited discovery, plaintiff must address considerable authority and significant facts, including the history of the works at issue and defendant's actions. The orders plaintiff will seek would enjoin acquiring, distributing, reproducing, displaying or creating derivatives from, in whole or in part, any of the copyrighted works at issue, and in particular from posting, transmitting or loading of any such materials onto the Internet or any network service or facility, as well as destruction, concealment or disposition of the works at issue which are in his possession. Plaintiff will further seek expedited discovery. Plaintiff recognizes that it faces a substantial burden to demonstrate the need and entitlement for an ex Parte TRO. It is ] impossible to meet that burden with a five page brief. (Declaration of Helena K. Kobrin.) While acting upon the need to proceed in an expedited fashion, plaintiff's counsel has expended considerable time reviewing the facts and law and attempting to present them,in the most succinct manner possible. Their efforts have resulted in limitation of plaintiff's application to 21 pages, which cannot be reduced further and still meet each legal criterion. (Ld.) Local Rule 1-2(c) specifically authorizes this Court to expand the number of pages permitted if warranted: Nothing in these local rules shall be construed to preclude a judge for good cause shown from exercising discretion to issue an order in a particular case which varies the procedures established by the local rules for that particular case. Such good cause is established in this case in light of the complexity of the facts and issues herein, and the imminent harm addressed in plaintiffs simultaneously lodged ex narte application for TRO. Plaintiff accordingly requests that it be given leave to file a motion and memorandum of points and authorities i pages in length in support of its ex parte application for a TRO, order to show cause, and order for expedited discovery, by entry of the simultaneously lodged proposed order granting such relief. DATED: April 4, 1996 Respectfully submitted, Thomas R. Hogan LAW OFFICES OF THOMAS R. HOGAN Roger M. Milgrim William M. Hart PAUL, HASTINGS, JANOFSKY & WALKER -and- Helena K. Kobrin [Helena was the only actual sig here] Attorneys for Plaintiff RELIGIOUS TECHNOLOGY CENTER [end of doc] Thomas R. Hogan, SBN 042048 LAW OFFICES OF THOMAS R. HOGAN 60 South Market Street, Suite 1125 San Jose, CA 95113-2332 (408) 292-7600 Roger M. Milgrim William M. Hart PAUL, HASTINGS, JANOFSKY & WALKER 399 Park Avenue Thirty-first floor ORIGINAL New York, New York 10022-4697 FILED (212) 318-6000 Helena K. Kobrin, SBN 152546 7629 Fulton Avenue RICHARD w. WIEKING North Hollywood, CA 91605 ~ US. DISTr,!CT CO'J~T (213) 960-1933 NQ~;hLRN Di~T",FT GALFORNIA SAN JOS~ Attorneys for Plaintiff RELIGIOUS TECHNOLOGY CENTER UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA RELIGIOUS TECHNOLOGY CENTER, a California non-profit corporation, Plaintiff, H KEITH HENSON, an individual, Defendant. DISTRICT OF CALIFORNIA RPA EX PARTE APPLICATION FOR TEMPORARY RESTRAIMNG ORDER, ORDER TO SHOW CAUSE RE: PRELIMINARY INJUNCTION, AND ORDER FOR EXPEDITED DISCOVERY; MEMORANDUM OF POINTS AND AUTHORITIES DATE: April 4, 1996 TIME: CTRM: CALIFORNIA: INTRODUCTION This application is necessitated by the imminent and credible threat of defendant Keith Henson to post or to cause to be posted to the Internet, hundreds of pages of heretofore unpublished, copyrighted, confidential materials of plaintiff Religious Technology Center (RTC), known as New Era Dianetics for Operating Thetans, or "NOTs" materials, which are maintained as trade secrets. (1) The NOTs materials are a series of 55 separate works (e.g., NOTs Series 1, 2, etc.). The trade secret status of these works was recognized in Bridge Publications. Inc.. et al. v. Vien, 827 F.Supp. 629, 633 (S.D.Cal. 1993). While the majority of the works within the NOTs Series have never appeared on the Internet, six of these works were posted without authorization on the Internet by Dennis Erlich, the defendant in the related case of Religious Technology Center v. Netcom On-Line Comm. Servs.. Inc., 1995 U.S. Dist. Lexis 16184 (ND. Cal. Sept.22, 1995) ("Netcomt"). In that case, Judge Whyte preliminarily enjoined Erlich from further copyright infringements of those six NOTs Works at issue there, but declined to enjoin Erlich under the California Uniform Trade Secrets Act as to those Works in part because of their limited posting to the Internet. While Netcom and other cases have preliminarily ruled that when trade secret materials have been posted onto the Internet, the owner cannot move for relief under the trade secret laws, plaintiff continues to contest those rulings on the ground that they do not correctly reflect the factual and legal consequences of such rulings. The situation which has arisen recently, and which exists in this case is entirely different. In March of this year, plaintiff was forced to file suit against an individual named Grady Ward (Religious Technolotgy Center v. Ward,Case No.96-20207 RMW), who was soliciting and threatening [footnotes] (1) "OT" is an abbreviation for Operating Thetan, A "thetan" in Scientology doctrine is a name for the individual spiritual being who is immortal and who survives from lifetime to lifetime. The term "operating thetan" designates a person able to "operate" to his full potential as a spiritual being. "Dianetics" is a sub-study of the Scientology religion, and "NED for OTs" or "NOTs" are abbreviations for "New Era Dianetics for Operating Thetans." (2) The defendant in Vien was permanently enjoined and ordered to pay RTC and the other plaintiffs [next page] to post all 55 of the NOTs Works, including the 49 works which have never been posted or publicly disclosed. In that case, also pending before Judge Whyte, a preliminary injunction hearing was held on March 29, 1996. At that hearing the Court stated its intention to issue a preliminary injunction, enjoining Ward and all persons in active concert with him who receive notice of the order from publishing, reproducing, or distributing the 55 NOTs Works and from acquiring or disclosing the 49 NOTs Works not previously posted to the Internet. The Court subsequently issued that injunction on April 1, 1996. Henson was in the Courtroom during the entire Ward preliminary injunction hearing. Nonetheless, following the hearing, he posted a message to a USENET newsgroup, alt.religion.scientology (3), announcing his unilateral decision, based on his interpretation of what had transpired at the hearing, that he was entitled both to solicit the NOTs materials and to post them, asserting that he was not in active concert with Ward, and that he believes that plaintiff cannot legitimately enforce its intellectual property rights. Under this reasoning Henson publicly threatened to post some or all of the entire NOTs series of 55 separate works. He also made his intentions to so proceed painfully clear by stating that he was prepared to go to plaintiff's attorney to receive service of process. Forty-nine of the NOTs works defendant is both soliciting and threatening to post have never been posted to the Internet, without RTC's authorization and in violation of its rights. RTC is therefore compelled to move now in order to have any meaningful possibility of preserving its rights and preventing this declared conduct, which, under existing authority, would cause irreparable harm. While under the circumstances, it is possible Henson may well already be enjoined by the preliminary injunction issued by the Court in Ward on April 1, 1996, because Henson is publicly soliciting these trade secret NOTs materials and threatening to post them, all the while challenging the application of that injunction to him, the need for a temporary restraining order against misappropriation, disclosure and reproduction is critical. Absent such an order, Henson will not only jeopardize plaintifI's intellectual property rights in heretofore unposted works, but will only compound the harm of previous postings. The threat of extreme and irreversible harm in the absence of an immediate restraining order is no further away than a few keystrokes on Henson's personal computer. [SIG MATERIAL FOLKS!!] [footnote] (3) USENET is a forum of thousands of news and discussion groups, called newsgroups, on various topics. [next page] Henson has also, in the same postings, engaged in actual infringements of the same copyrighted, unpublished material of RTC. This application is addressed, however, only to preventing the impending, future infringements and trade secret misappropriation which defendant is now threatening. GROUNDS FOR APPLICATION Plaintiff applies to the Court for the requested relief pursuant to Rule 65 of the Federal Rules of Civil Procedure, on the grounds that plaintiff holds exclusive rights of use, disclosure, reproduction, distribution, and public display of the NOTs scriptures which are protected as both unpublished works under federal copyright law, and underlying information, under the California Uniform Trade Secrets Act: that in violation of plaintiff's intellectual property rights, defendant Henson has posted to the Internet plaintiff's confidential, copyrighted religious scriptures; that Henson has now solicited additional unauthorized copies of the NOTs scriptures and has threatened that he will post these copies to the Internet, all in spite of notification by RTC of its rights and objections to any such unauthorized copying and disclosure; and that plaintiff will be severely and irreparably injured unless Henson is immediately restrained from such actions. FORM OF TEMPORARY RESTRAINING ORDER REQUESTED Plaintiff requests that, pending the hearing on the Order to Show Cause Re: Preliminary Injunction, this Court issue: A. A Temporary Restraining Order enjoining and restraining defendant Henson, and all of his agents, servants, employees, partners, privies and attorneys, and all persons acting or purporting to act under his authority, direction or control, and all persons in active concert or participation with him, or acting on his behalf, having advance notice of this order from: 1. directly or indirectly, in whole or in part, publishing, reproducing, distributing, performing, or creating derivative works based upon, the Exhibit B Works, or any of them, in any media now known or hereafter developed in any time, place or fashion, and in particular, from engaging in any such acts in, on, or in connection with any computer, database, information service, electronic bulletin board service, network, storage facility, or archives, or other electronic or computer device, service, network or facility, including, without limitation, the transmitting or loading of any such materials onto or downloading any copies thereof from any such device, service, network or facility; and that all such copies which defendant, his agents, servants, employees, partners, privies, and attorneys and those in active concert or participation with them have caused to be copied or copied onto any such device, service, network, or facility be removed and turned over to plaintiff's counsel. Nothing in this paragraph 1 shall be construed to prohibit fair use of such works, as set forth in 17 U.S.C.107. [note last sentence!!] 2. directly or indirectly, engaging in the further unauthorized disclosure, or display, of the Exhibit B Works, or portions thereof (excluding only NOTs Series issues 1, 24, 34, 35, 36, and 42 which are also the subject of other pending litigation), and specifically from disclosing, displaying, transmitting or otherwise loading any of the Exhibit B Works, or portions thereof (excluding only NOTs Series issues 1, 24, 34, 35, 36, and 42 which are also the subject of other pending litigation), in any media now known or hereafter developed in any time, place or fashion, or onto any computer, database, information service, electronic bulletin board service, network, storage facility; or archives, or other electronic or computer device, service, network or facility and that all such copies which defendant, his agents, servants, employees, partners, privies, and attorneys and those in active concert or participation with them have caused to be copied or copied onto any such device, service, network, or facility be removed and turned over to plaintiff's counsel. (The fair use defense is not applicable to this paragraph, as it is based upon plaintiff's contention that the documents are protectable as trade secrets.) 3. directly or indirectly, engaging in the further unauthorized solicitation and/or acquisition, the Exhibit B Works, or portions thereof (excluding only NOTs Series issues 1, 24, 34, 35, 36, and 42 which are also the subject of other pending litigation), and specifically from soliciting, acquiring, seeking to acquire, or otherwise downloading any of the Exhibit B Works, or portions thereof (excluding only NOTs Series issues 1, 24, 34, 35, 36, and 42 which are also the subject of other pending litigation), from any media now known or hereafter developed in any time, place or fashion, or from any computer, database, information service, electronic bulletin board service, network, storage facility, or archives, or other electronic or computer device, service, network or facility; and that all such copies which defendant, his agents, servants, employees, partners, privies, and attorneys and those in active concert or participation with them have caused to be copied or copied from any such device, service, network, or facility be removed and turned over to plaintiff's counsel; 4. directly or indirectly destroying, altering or concealing, or in any way disposing of, any reproduction, copy, facsimile, excerpt, or derivative of any work of L. Ron Hubbard that is in defendant's possession, custody or control, in whole or in part, including, but not limited to, those materials located in any so-called "off-site" storage areas, electronic or otherwise, or otherwise despoiling or causing the despoliation, or alteration of any evidence, in whole or in part, in any form, place or media relating to defendant's conduct complained of in this action; and 5. causing or inducing any other person to engage in any of the foregoing prohibited acts; and, 6. filing with the Court, except under seal, any documents that contain any of the Advanced Technology. B. An Order granting expedited discovery, including document production and depositions, and third-party discovery, on 3 days' notice notwithstanding the waiting periods of Fed.R.Civ.P. 26(d). FORM OF REQUESTED ORDER TO SHOW CAUSE Plaintiff further requests that this Court issue an order directing defendant Henson to show cause why a preliminary injunction should not be issued enjoining and restraining defendant Henson, and all of his agents, servants, employees, partners, privies and attorneys, and all persons acting or purporting to act under his authority, direction or control, and all persons in active concert or participation with him or acting on his behalf, having advance notice of this order, from: 1. directly or indirectly, in whole or in part, publishing, reproducing, distributing, performing, or creating derivative works based upon, the Exhibit B Works, or any of them, in any media now known or hereafter developed in any time, place or fashion, and in particular, from engaging in any such acts in, on, or in connection with any computer, database, information service, electronic bulletin board service, network, storage facility, or archives, or other electronic or computer device, service, network, or facility including, without limitation the transmitting or loading of any such materials onto, or downloading any copies thereof from any such device, service, network or facility; and that all such copies which defendant, his agents, servants, employees, partners, privies, and attorneys and those in active concert or participation with them have caused to be copied or copied onto any such device, service, network, or facility be removed and turned over to plaintiffs counsel. Nothing in this paragraph 1 shall be construed to prohibit fair use of such works, as set forth in 17 U.S.C., 107. 2. directly or indirectly, engaging in the further unauthorized disclosure, or display, of the Exhibit B Works, or portions thereof (excluding only NOTs Series issues 1, 24, 34, 35, 36, and 42 which are also the subject of other pending litigation), and specifically from disclosing, displaying, transmitting or otherwise loading any of the Exhibit B Works or portions thereof (excluding only NOTs Series issues 1, 24, 34, 35, 36, and 42 which are also the subject of other pending litigation), in any media now known or hereafter developed in any time, place or fashion, or onto any computer, database, information service, electronic bulletin board service, network, storage facility; or archives, or other electronic or computer device, service, network or facility; and that all such copies which defendant, his agents servants, employees, partners, privies, and attorneys and those in active concert or participation with them have caused to be copied or copied onto any such device, service, network, or facility be removed and turned over to plaintiff's counsel. (The fair use defense is not applicable to this paragraph, as it is based upon plaintiff's contention that the documents are protectable as trade secrets.) 3. directly or indirectly, engaging in the further unauthorized solicitation and/or acquisition of the Exhibit B Works, or portions thereof (excluding only NOTs Series issues 1, 24, 34, 35, 36, and 42 which are also the subject of other pending litigation), and specifically from soliciting, acquiring, seeking to acquire, or otherwise downloading any of the Exhibit B Works, or portions thereof (excluding only NOTs Series issues 1, 24, 34, 35, 36, and 42 which are also the subject of other pending litigation), from any media now known or information service, electronic bulletin board service, network, storage facility, or archives, or other electronic or computer device, service, network or facility; and that all such copies which defendant, his agents, servants, employees, partners, privies, and attorneys and those in active concert or participation with them have caused to be copied or copied from any such device, service, network, or facility be removed and turned over to plaintiff's counsel; 4. directly or indirectly destroying, altering or concealing, or in any way disposing of, any reproduction, copy, facsimile, excerpt, or derivative of any work of L. Ron Hubbard that is in defendant's possession, custody or control, in whole or in part, including, but not limited to, those materials located in any so-called "off-site" storage areas, electronic or otherwise, or otherwise despoiling or causing the despoliation, or alteration of any evidence, in whole or in part, in any form, place or media relating to defendant's conduct complained of in this action; and 5. causing or inducing any other person to engage in any of the foregoing prohibited acts; and, 6. filing with the Court, except under seal, any documents that contain any of the Advanced Technology. This application is based upon this Ex Parte Application, the accompanying Memorandum of Points and Authorities, the facts set forth in the accompanying declaration of Warren McShane, the Verified Complaint in this action, and such additional evidence and arguments as may properly be presented at or before the hearing of the application. Dated: April 4 1996 Respectfully submitted, Thomas R. Hogan LAW OFFICES OF THOMAS R. HOGAN Roger M. Milgrim William M. Hart PAUL, HASTINGS, JANOFSKY & WALKER -and- Helena K. Kobrin Attorneys for Plaintiff RELIGIOUS TECHNOLOGY CENTER *EX PARTE* APPLICATION TABLE OF CONTENTS I PRELIMINARY STATEMENT II FACTUAL STATEMENT A. Plaintiff Holds The Exclusive Rights To the Intellectual Properties Which Are the Subject of This Suit B. There is Substantial and Compelling Evidence that Defendant Keith Henson is about to post All or Portions of the NOTs Series and that He Previously Has Posted and/or Caused to be Posted RTC's Advanced Technology Materials to the Internet. III. DEFENDANT PLAINLY HAS INFRINGED PLAINTIFF'S COPYRIGHTS UNDER FEDERAL LAW IV DEFENDANT HAS WRONGFULLY ACQUIRED, AND IMMINENTLY THREATENS TO CAUSE THE DISCLOSURE OF, RTC'S TRADE SECRET RELIGIOUS SCRIPTURES PAGE A. NOTs Consists of 55 Issues No More Than Six of Which Have Ever Been Posted to the Internet B. Bases For a Temporary Restraining Order V. PLAINTIFF IS ENTITLED TO A TEMPORARY RESTRAIMNG ORDER AND PRELIMINARY INJUNCTION A. Plaintiff Has Established A Likelihood Of Success On The Merits B. Plaintiff Will Be Irreparably Injured If Defendant Is Not Preliminarily Enjoined C. The Equities Weigh Heavily In Favor of Granting The Temporary Restraining Order And Preliminary Injunction D. Defendant Should Not Be Given Notice Prior To Issuance Of The Temporary Restraining Order VI. RTC'S MOTION FOR EXPEDITED DISCOVERY SHOULD BE GRANTED CONCLUSION EX PARTE APPLICATION TABLE OF AUTHORITIES CASE [The scanner made hash out of this, skip down, there is more below, and if anyone really needs this I can fax it.] A~ee V. Paramount, 59 F.3d 317 (2d Cir. 1995) Alekna2ik Natives Ltd. v. Andrus 648 F.2d 496 (9th Cir. 1980) American Can Co. V. Mansukhani 742 F~2d 314 (7th Cir. 1984) . . . American Credit Jndemnitv Co. v Sacks, 213 Cal.App.3d 622, 262 Cal. Rptr. 92 (2d Dist. 1989) American Geophvsical Union v Texaco, 802 F~Supp 1, afi'd 60 F.3d 913 (2d Cir. 1994) Apple Computer. Inc. v. Formula Int'l. Inc., 562 F. Supp. 775 (C.D. Cal. 1983) afPd 725 F.2d 521(9th Cir. 1984) Apple Computer. Inc. v. Formula Int'l. Inc., 725 F.2d 521(9th Cir. 1984) Austin v. Steiner, 207 F. Supp. 776 (N.D. III. 1962) Baxter V. MCA Inc., 812 F.2d 421(9th Cir.), cert. denied 484 U.S. 954, 108 S.Ct. 346 (1987) Beltran V. Myers, 677 F.2d 1317 (9th Cir. 1982) Bridge Publications Inc. v. Vien, 827 F. Supp. 629 (C.D. Cal. 1993) Computer Associates V. Altai Inc., 982 F.2d 693 (2d Cir. 1992) CPG Products Corp. v Me2o Corp., 502 F. Supp. 42 (S.D. Ohio 1980) Data East USA. Inc. v Epyx, Inc., 862 F.2d 204 (9th Cir. 1988) Fimab-Finanziaria Ma2lificio. Etc. v. Kitchen, 548 F. Supp. 248 (S.D. Fla. 1982) FMC Corp. v Taiwan Tainan Giant Indus. Co., 730 F.2d 61 (2d Cir. 1984).... PAGE 12 17 Geor~ia Television Co. V. TV News Clips of Atlantic, IX 'A k~VI. A J'I'I~JCA~I~I()N II I CASE 718 F. Supp. 939 (ND. Ga. 1989) Hearst Corp. v. Stark, 639 F. Supp. 970 (ND. Cal. 1986) Historical Pub. Co. V. Jones Bros. Pub. Co., 231 F. 638 (3d Cir. 1916) Imi-Tech Corp. V. Ga2liani, 691 F. Supp. 214 (S.D. Cal. 1986) Johnson Controls. Inc. v. Phoenix Control Sys. Inc., 886 F.2d 1173 (9th Cir. 1989) Leeds Music Limited v. Robin, 358 F. Supp. 650 (S.D. Ohio 1973) Lockheed Missile & Space Co. v. Hu~hes Aircraft Co, 887 F. Supp 1320 (N.D. Cal. 1995) Los An~eles Memorial Coliseum v. NFL, 634 F.2d 1197 (9th Cir. 1980) MAI Svstems Corporation v. Peak Computer. Inc.. 991 F.2d 511(9th Cir. 1993) Matter of Vuitton et Fils S.A., 606 F.2d 1 (2d Cir. 1979) Matthews v. Allen, 182 F.2d 824 (4th Cir. 1950) Metro-Goldwvn-Maver. Inc. v. American Honda Motors Co. 900 F. Supp. 1287 (C.D. Cal. 1995) Mor2an V. Veach, Cal.App.2d 682, 139 P.2d 976, 980 (1943) Norand Corp. v. Parkin, 785 F. Supp. 1353 (ND. Iowa 1990) People ex rel. Youn2er v. F.E. Crites, Inc., 51 Cal.App.3d 961, 124 Cal.Rptr. 664 (1975) RCA Records v. All-Fast Sys.. Inc., 594 F. Supp. 335 (S.D.N.Y. 1984) Rokus v. American Broadcastin~ Company, Inc. 616 F. Supp. 110 (S.D.N.Y. 1984) Southern Music Publishin~ Co. Inc. v. C.& C. Films. Inc. EX PARTE APPLICATION 'II PAGE l7~ F. Supp. 832 (S.D.N.Y. 1959) 13 Szabo V. Errisson, 68 F.3d 940 (5th Cir. 1995) 19 Transgo. Inc. v. Ajac Transmission Parts Corp., 768 F.2d 1001(9th Cir. 1985), cert. denied, 474 U.S~ 1059, 106 S.Ct. 802 (1986) . . 18 Triad Sys. Corp. v. Southeastern Express Co., 64 F.3d 1330 (9th Cir. 1995) cert. denied ____ S. Ct. ____, 1995 WL 699118 . 18, 19 C Wainwri~ht Sec. v. Wall Street Transcrii,t Corp., 558 F.2d 91 (2d Cir. 1977), cert. denied, 434 U.S. 1014, 98 S.Ct. 730 (1978) . 19 OTHER 17 U.S.C. ' 410(c) 17 U.S.C. ' 501(b) 17 U.S.C. ' 502(a) 17 U.S.C. ' 106 17 U.S.C. ' 502(a) Cal. Civ. Code ' 3426 . M. Nimmer & D. Nimmer, Nimmer on Copyri~ht ' 13.01 Title 17 U.S.C. ' 201(d) EX PARTE APPLICATION MEMORANDUM OF POINTS AND AUTHORITIES IN SUPORT OF EXPARTE APPLICATION FOR TEMPORARY RESTRAINING ORDER AND ORDER TO ShOW CAUSE RE: PRELIMINARY INJUNCTION I. PRELIMINARY STATEMENT Plaintiff Religious Technology Center ("RTC") holds exclusive rights to the confidential, copyrighted literary works of L. Ron Hubbard known as the NOTs scriptures. All of these works are unpublished and contain confidential religious information and processes which plaintiff treats as trade secrets. Defendant Keith Henson has, through his activities on the Internet engaged in unauthorized, wholesale copying and electronically distributing certain RTC copyrighted materials onto the Internet. Henson is currently requesting, in public Internet postings made in March 30 and 31, that others send him copies of the NOTs work with the clear threat that some or all of these, too, will be posted to the Internet. Henson's threats and solicitations are made with full knowledge of and seeming disdain for the Temporary Restraining Order issued by this Court on March 21, 1996, and the Court's remarks at the Preliminary Injunction hearing held on March 29, 1996, which Henson unilaterally interprets as blessing his activities. Henson flagrangly rebuffed the cease and desist letter sent to him, asserts that the TRO against Ward does not apply to him, and that, indeed, Judge Whyte's remarks at the Ward preliminary injunction hearing actually support solicitation and posting of NOTs works, based on his unilateral decision to show the world that plaintiff is not entitled to assert its intellectual property rights. Defendant's past copying and imminent future copying and threatened electronic transmission of plaintift's copyrighted works violate federal copyright law, and the unauthorized acquisition as well as the wrongful threatened disclosure of the contents of the unpublished works violates RTC's rights under California trade secrets law. Absent an immediate injunction, Henson will continue his unlawful actions, and may well succeed in destroying RTC's trade secret rights. II. FACTUAL STATEMENT A. Plaintiff Holds The Exclusive Rights To the Intellectual Properties Which Are the Subiect of This Suit I. Prior to his death in 1986, L. Ron Hubbard created numerous literary works which [are] protected by federal copyright law and duly registered with the Copyright Office. (McShane Dec., 16-19,22-23, and Ex. F to the complaint.) certain of those works confidential and unpublished and substantial measures have been taken by plaintiff Religious Technology Center ("RTC"), which became the owner of the trade secrets in these works through assignment from Mr. Hubbard, to maintain the confidentiality of the works. RTC is also the exclusive licensee of the copyrights in those works. (McShane Dec., 66 39-40.) 2. RTC derives substantial revenue from the delivery by its limited group of licensees to select parishioners of services utilizing Mr. Hubbard's unpublished literary works containing the Advanced Technology. (McShane Dec., 6 20.) The informational content of the works also derives independent economic value, actual and potential, from not being generally known to other persons who can obtain economic value from their disclosure or use. Plaintiff and its predecessors have taken in the past, and continue to take, extraordinary efforts to protect and maintain the confidentiality and secrecy of the Advanced Technology, carefully limiting physical access to the materials. 3. The works in question in this case, known as New Era Dianetics for Operating Thetans, or "NOTs" materials, have never left the custody of RTC, its predecessors or authorized licensees except through a theft in Denmark in 1983, for which one of the co-conspirators was arrested, tried and convicted. (McShane Dec., 6 36.) In the past, competing churches have been set up to use those stolen works to deliver competitive services, and other groups exist today which are interested in similarly exploiting these works. Wd., 6 37.) Because the defendant's activities at issue here now jeopardize if not threaten to destroy plaintiffs valuable intellectual property rights, there could be no demonstrably greater need for immediate injunctive relief. B. There is Substantial and Compelling Evidence that Defendant Keith Henson Is about to Post All or Portions of the NOTs Series and that He Previously Has Posted and/or Caused to be Posted RTC's Advanced Technolo2V Materials to the Internet. Defendant Keith Henson is a resident of San Jose, California. (McShane Dec., 6 10.) Henson frequents the alt.religion. scientology USENET "newsgroup" on the Internet. In a posting to alt.religion.scientology or "ARS" on March 30, 1996, Henson infringed RTC's copyright in a work known as NOTs Series 34, by posting the entirety of that work to ARS verbatim.4 (Id., 6 3.) [footnote] (4) Postings to USENET newsgroups such as alt.religion.scientology are very transitory in nature and are available on the newsgroup for, at most, a few days [end footnote] Henson used this Court as the pretext for that posting. Although he was not a named party to the Ward case, and denies being bound by it, he posted "An Open Letter to Judge Whyte,~' and included in the message the contents of what he claimed was a letter he had written to this Court. He also advised readers that he was "publicly seeking more NOTs material, stolen or not." (Emphasis supplied.) The "NOTs" works which Henson was soliciting are the entirety of a set of the unpublished, confidential works known as New Era Dianetics for Operating Thetans, or "NOTs".5 (McShane Dec., 6 11.) In his March 30 posting, Henson acknowledged that he had read, in its entirety, a posting to alt.religion.scientology of the Temporary Restraining Order issued by this Court on March 21, 1996 in the RTC v. Ward, against Grady Ward, which prohibited the reproduction, distribution, or performance of any of the NOTs works, and prohibited the acquisition, display, or disclosure of 49 of the NOTs works (all but NOTs Series 1, 24, 34, 35, 36, and 43.) It is therefore plain that he was aware that RTC claims--and the Court preliminarily finds--trade secret and copyright protection for these materials. (McShane Dec., 6 4.) Henson also was present at the preliminary injunction hearing in Ward and announced in his posting that: "[a]fter talking to the court," he was convinced that, unlike Grady Ward, he was absolutely free to solicit and post plaintiffs copyrighted material to the Internet on the theory that his purpose to show plaintiff is "criminal" -- "overrides commercial copyright considerations." (McShane Dec.) Counsel for RTC, Helena Kobrin, sent Henson a cease and desist letter via e-mail on March 30 to inform him that RTC regards these works as trade secrets, and that even their acquisition is regarded as a misappropriation under California law. (McShane Dec. 6 5 and Ex. H to Complaint.) On March 31, [footnote] The NOTs materials to which Henson refers are comprised of 55 separate works which are registered as a collective work on registration TXu 257-326. (Ex. G to Complaint.) Although certain of the Works within the collection, Nos. 1, 24, 34, 35, 36, and 42 previously have been improperly posted on the Internet by Dennis Erlich and others, none of the other 49 works in the collection which Henson has recently been soliciting has ever been so posted. (McShane Dec., 66 11-13 and fn. 3.) While Judge Whyte's preliminary injunction ruling declined to recognize trade secret status of the six works as a result of their Internet postings, he did leave the issue open for further review. (McShane Dec., 6 44.) However, by this motion, RTC is not seeking preliminary relief as to those six works on trade secret grounds, but only on copyright infringement grounds The Court should be aware that these six NOTs works, have already been subject to rulings that anonymous or third party Internet postings, other than those of the given defendants in each case, deprived those individual works of trade secret protection. All of these proceedings are still continuing and the plaintiff challenges the described rulings. RTC is not presently asserting trade secret claims to this action for the prior postings by Henson, but reserves its right to do so. [end footnote] Mrs Kobrin also wrote to counsel for Henson's service provider, Netcom On-Line Communications Services, Inc., ("Netcom"), requesting that Netcom warn Henson not to post RTC's copyrighted materials and that continuing violations would result in suspension of Mr. Henson's account. (McShane Dec. 6 6 and Ex. 7.) While no response has yet been received from Netcom, Henson responded to Mrs. Kobrin's letter in two fashions. First, on March 30, he posted his "Open Letter to Judge Whyte," with NOTs Series 34 again included, to alt.religion.scientology. (McShane Dec. 6 7 and Ex. 2.) Second, he responded to Ms. Kobrin by e-mail that same day and also posted that message to alt. religion.scientology on April 1. (Id.) In that response, Mr. Henson told Mrs. Kobrin that he was "going to put it a little nicer than Grady [Ward] would, but you can take your demand, fold it till it is all corners, and stick it where 'the Sun don't shine."' He then said he was *again* asking for NOTs or any other Scientology 'AT' [Advanced Technology] materials, acquired by legal, or *illegal* means, further announcing his intention to "post this material in the public interest." (McShane Dec. 6 7, and Ex. H to Complaint and Ex. 3.) Henson's attempt to justify his posting clearly does not excuse his violations of RTC's intellectual property rights. He merely said that the "document was right in the middle of a letter to Judge Whyte" and that: I am certainly not an "agent, servant or employee" of either Dennis Erlich or Grady Ward, nor do I act under any kind of direction or control. He also announced his intention to proceed with his activities regardless of any threat of legal action, challenging RTC to file suit against him, and stating he would go to the offices of RTC's attorney, Thomas Hogan, and pick up any papers from him. If Henson is not now restrained, it is probable that he will carry out his threats to post the NOTs materials in part or in their entirety, since he has obviously been engaging in measures towards that end. That this litigation is necessary to prevent him from doing so is made clear by his postings which [footnote] Henson also suggested that he was not acting in concert or participation with Ward. His protestation rings hollow, however, in light of his involvement with Ward in other activities, such as a trip to the Church of Scientology in San Francisco to harass the Church and its members. (McShane Dec., 6 9.) [end footnote] indicate that he believes this Court has sanctioned his conduct and by his statement in the posting of his so-called "Open Letter to Judge Whyte," [states] that it is his right to post the NOTs materials, but that "if' you {the Court] feel the TRO *does* preclude quoting examples of the copyrighted, trade secret, criminal instruction manuals of the 'Church' of Scientology, please let me know." (Ex. to McShane Dec.) III. DEFENDANT PLAINLY HAS INFRINGED PLAINTIFF'S COPYRIGHTS UNDER FEDERAL LAW Only two elements must be proven in a copyright infringement action: ownership of a valid copyright and copying of the copyrighted work. Data East USA. Inc. v. Epyx. Inc., 862 F.2d 204, 206 (9th Cir. 1988); Baxter v. MCA. Inc., 812 F.2d 421, 423 (9th Cir.), cert. denied, 484 U.S. 954, 108 S.Ct. 346 (1987); M. Nimmer & D. Nimmer, 3 Nimmer on CopVn.2ht ' 13.01 ("Nimmer"). Title 17 U.S.C. ' 201(d) provides that "The owner of any particular exclusive right is entitled, to the extent of that right, to all of the protection and remedies accorded to the copyright owner by this title." Plaintiff is the exclusive licensee and therefore is entitled to the same remedies and protections as the original holders of the copyrights. Hearst Corn. v. Stark, 639 F. Supp. 970, 973 (N.D. Cal. 1986), 3 Nimmer ' 13.01[A]. The literary works in question have been duly registered (7) pursuant to the Copyright Act. (Exhibit to Complaint.) Plaintiff and its licensors thereby secured and perfected its exclusive rights and privileges in and to those copyrights. Thus, plaintiff, as the exclusive licensee of the copyrights, may bring this action for copyright infringement pursuant to 17 U.S.C. ' 501(b). That defendant copied and electronically distributed one of RTC's copyrighted works is beyond dispute. (See McShane Dec., 66 3 and 7, Exs. 1 and 2.) His acts violate the exclusive rights of RTC set forth in section 106 of the Copyright Act, (8) as do the defendant's inducements to have others make additional illicit copies of the entire NOTs materials and the clear threat that he will post (i.e., electronically reproduced and distributed) them in their entirety on the Internet. [footnotes] 7 See note 16, infra. 8 Such acts violate RTC's exclusive rights of reproduction, distribution, and display under 17 U.S.C. 59 F.3d 317 (2d Cir. 1995). The evidence now before the Court consisting, in Mr. Henson's own words, of solicitations to obtain confidential, copyrighted Church materials, coupled with his threats to post such materials unless the Court lets him know he may not do so, render most probable the imminent posting of all or portions of the NOTs series without the Court's intervention. Leaving aside, for the moment, defendant's already proven past infringements of RTC's works, a threatened infringement of copyright is not only an appropriate, but one of the most compelling exercises of this Court's equitable jurisdiction, "to prevent an infringement." 17 U.S.C. ' 502(a); see, e.~., Leeds Music Limited v. Robin, 358 F. Supp. 650, 662 (S.D. Ohio 1973) (preliminary injunction to restrain defendant from "threatened plans ... in complete disregard of plaintiff's . . . presumptively valid copyrights"). The "[c]ourts have repeatedly held that an action to enjoin a threatened infringement of the rights of a copyright owner is one arising under the Copyright Law of the United States." Southern Music Publishing Co. Inc. v. C.& C. Films, Inc., 171 F. Supp. 832, 833 (S.D.N.Y. 1959),'~ citing inter alia, Historical Pub. Co. v. Jones Bros. Pub. Co., 231 F. 638 (3d Cir. 1916): If, therefore, the evidence shows that the defendant was then threatening to infringe the copyright, plaintiffs were entitled to protection, although no actual infringement had as yet taken place. One of the objects of an injunction is to restrain the future commission of injurious acts, for a suit at law is the appropriate remedy for acts that have already been done. If authority be needed for so elementary a proposition, it may be found ... [numerous citations omitted]. "[T]o sustain a claim for threatened infringement, it must appear that one is about to infringe or take some action which is prejudicial to the rights of the copyright owner. Or as otherwise stated, threatened acts of infringement may be enjoined, if the opportunity and the intent to infringe are present." Southern Music, supra, 171 F. Supp. at 833, quoting Matthews v. Allen, 182 F.2d 824, 828 (4th Cir. 1950) This is clearly the law in this Circuit. See MAI Systems Corporation v. Peak Comnuter, Inc., 991 F.2d 511, 519 (9th Cir. 1993) (emphasis added): As a general rule, a permanent injunction will be granted when liability has been established and [footnotes] '~ See also Austin v. Steiner, 207 F. Supp. 776, 779-80 (ND. III. 1962) (defendant did not infringe but represented it had the right to copy; permanent injunction granted against infringement by defendant). Southern Music was cited with approval in Rokus v. American Broadcasting CQj~p~11~ Inc., 61 6 F. Supp. 110, 112 (S.D.N.Y. 1984). ___ [end footnotes] there is a threat of continuing violations [citations omitted] However section 502 of the Copyright Act authorizes the court to "grant temporary and final injunctions on such terms as it may deem reasonable to prevent or restrain infringement of a copyright." 17 U.S.C. ' 502(a) (emphasis added). While thene has heen no showing that Peak has actually loaned out any MAI software, the tilneat of a violation is clear as Peak has MAI computers in its loaner inventory. The permanent injunction is upheld as it relates to this issue. Here there is no question of either Mr. Henson's opportunity or his intent to infringe, or of the imminence of the threatened conduct. Coupled with evidence of defendant's past Internet postings, constituting clear infringements of plaintiff's copyrighted works, the need for the requested injunctive relief is critical. See, RCA Records v. All-Fast Sys.. Inc., 594 F. Supp. 335, 338 (S.D.N.Y. 1984) (preliminary injunction to prevent future infringing acts where a "reasonable expectation" of violation exists). Indeed, in such cases the courts have issued extremely broad injunctions covering works not yet even in existence. See eg., Georgia Television Co. ] V. TV News CliDS of Atlantic, 718 F. Supp. 939, 944 (N.D. Ga. 1989), affd without Op.983 F.2d 236 (11th Cir. 1993).~i3 IV. DEFENDANT IS WRONGFULLY SOLICITING AND IMMINENTLY THREATENS TO CAUSE THE DISCLOSURE OF, RTC'S TRADE SECRET RELIGIOUS SCRIPTURES The California Uniform Trade Secrets Act, Cal. Civ. Code ' 3426 ("UTSA"), defines as "misappropriation" defendant's admitted acts, consisting of: (1) Acquisition of a trade of another by a person who know or has reason to know that the trade secret was acquired by improper means; or (2) Disclosure or use of a trade secret of another without express or implied consent by a (i) person who: (A) Used improper means to acquire knowledge of the trade secret; or (B) At the time of disclosure or use, knew or had reason to know that his knowledge of the trade secret was: (ii) Acquired under circumstances giving rise to a duty to maintain its secrecy or limit its use; or (iii) Derived from or through a person who owed a duty to the person seeking relief to maintain its secrecy or limit its use . Id. ' 3426.1. When such events occur, the court can enjoin actual "or threatened misappropriation." Id. [footnote] 11 "Preliminary injunctions are a common judicial response to the imminent infringement of an apparently valid copyright . . . The fact that WSB-TV's future news broadcasts are not presently created does not preclude injunctive relief against defendants' videotaping these copyrighted broadcasts because 17 U.S.C ' 502(a) provides for injunctions to prevent infringement of a copyright and not necessarily the registered copyright that gives rise to the action." 718 F. Supp at 944 [end footnote] section 3426.2(a) (emphasis added). As shown below, defendant's wrongful acqusition and threatened disclosure of plaintifI's trade secrets not only warrant but compel injunctive relief. A. NOTs Consists of 55 Works No More Than Six of Which Have Ever Been Posted to the Internet Of the 55 separate works comprising the NOTs Series, at least 49 have never even arguably been made public. (McShane Dec. 66 11-13 and fn. 3.) Whether, in fact, the fleeting presence of the six that have been posted on the Internet divested them of trade secret status is a matter that has been ruled adversely to the plaintiff on a preliminary injunction ruling in this district. Religious Technology Center v. Netcom On-Line Communication Servs. Inc., Slip Op., at 30 (N.D. Cal. Sept.22, 1995). That ruling, however, invited the plaintiff to reapply for a preliminary injunction on the alternate "serious question" test. Id. slip op. at 32~33.12 The focus of this motion need not be limited to the six NOTs works that Judge Whyte has tentatively determined were placed in the public domain by reason of posting on the Internet. That is because the remaining 49 works which Mr. Henson may be attempting to misappropriate have not in any way been posted or otherwise made public and, accordingly, unquestionably retain their trade secret character See Bridge Publications Inc. V. Vien, 827 F. Supp. 629, 633 (S.D. Cal. 1993); Netcom, Op.at 27: The court finds that RTC has put forward sufficient evidence that it took steps that were reasonable under the circumstances to protect its purported trade secrets. RTC's president describes elaborate means taken to ensure the confidentiality of the Advanced Technology works, including use of locked cabinets, safes, logging and identification of the materials, availability of the materials at only a handful of sites worldwide, electronic sensors attached to documents, locked briefcases for transporting works, alarms, photo identifications, security personnel, and confidentiality agreements for all of those given access to the materials. Netcom, Op. at 27. Furthermore, the existence of the Netcom decision did not prevent the Court from issuing a TRO and a preliminary injunction in RTC v. Ward enjoining entirely solicitation and disclosure of those 49 Works. B. Bases For a Temoorary Restraining Order [footnote] 12 A hearing on the alternate test for the preliminary injunction is set for May 24, 1996 at which time plaintiff intends to demonstrate that there is a serious question going to the merits on the issue of whether, in fact, the postings terminated the trade secrecy of the six NOTs works posted by Dennis Erlich. [end footnote] Defendant Henson's March 30, 1996 posting on the Internet acknowledges that he has read the TRO entered against Grady Ward by this Court on March 21, 1996. (McShane Dec., 6 4 and Ex. 1.) Thus, defendant Henson is quite aware that RTC claims trade secret status for the NOTs works at issue here.13 Hence, his soliciting these unpublished, confidential materials from others will, if his quest is successful, result in Henson's misappropriation by the acts of improper acquisition and receipt from one not authorized to disclose. Judge Whyte noted the extraordinary safeguards that plaintiff employs to safeguard the NOTs materials, which materials represent a vital means by which the Church of Scientology obtains the funds it needs for its work (McShane Dec., 6 20). He also carefully traced the presence of the plaintiffs materials outside the strict safeguards of the Church of Scientology to one or more series of criminal acts. Netcom, slip op. at 27. These acts are well publicized, and as a matter of law the knowledge of this should be imputed to defendant Henson, whose own solicitations ask for stolen materials. (McShane Dec. 66 3 and 7 and Ex. 1 and 2.) Acquiring such material constitutes misappropriation under the California UTSA; the appropriate relief under the California UTSA is clear: "Actual or threatened misappropriation" can and should be enjoined. Cal. Civ. Code ' 3426.2(a) (emphasis added); American Credit Indemnity Co. v. Sacks, 213 '7 Cal.App.3d 622, 262 Cal. Rptr. 92, 100-01 (2d Dist. 1989) (threatened use of plaintiffs trade secret customer list through solicitation warranted preliminary injunction); Imi-Tech Corp. v. Gaitliani, 691 19 F. Supp. 214, 229-30 (S.D. Cal. 1986) (preliminary injunction to prevent imminent disclosure of trade secrets); CPG Products Corp. v. Meito Corn., 502 F. Supp. 42, 44 (S.D. Ohio 1980) (granting TRO to prevent threatened transfer of trade secrets to third party outside United States), see Norand Corp. V. Parkin, 785 F. Supp. 1353, 1355 (N.D. Iowa 1990) (granting TRO to prevent former employee of plaintiff from accepting a position with plaintiffs primary competitor from which he threatened to disclose plaintiffs trade secrets). Misappropriation, by its nature, and most certainly Henson's threatened misappropriation based on [footnote] 13 In Henson's posting , he admitted having read the TRO issued in Ward on March 21, 1996. In the TRO, the Court explicitly enjoined Ward on trade secret grounds from acquiring or disclosing the exact same NOTs works at issue here. [end footnote] his unilateral assertion that he is the ultimate arbiter of law and will therefore decide what he can or cannot do, which is intended to lead to widespread unauthorized disclosure of plaintifPs trade secrets, causes irreparable harm. Imi-Tech Corp., 691 F. Supp. at 230. Were the defendant to succeed in implementing his misappropriation scheme after the wrongful acquisition of these trade secrets, posting on the Internet (the act being both a wrongful copying and distribution or display)'4 is surely the next step. If even ephemeral posting is, as this Court has preliminarily ruled, the end of a trade secret status, RTC will be denied an opportunity of obtaining complete, indeed any, relief. Why? Because "A trade secret once lost is, of course, lost forever." FMC Corn. v. Taiwan Taiwan Giant Indus. Co., 730 F.2d 61, 63 (2d Cir. 1984). This situation is indeed an appropriate subject for preliminary injunction under trade secret law for at least the 49 NOTs works which have never been posted or otherwise made public. That is what plaintiff seeks here. V. PLAINTIFF IS ENTITLED TO A TEMPORARY RESTRAINING ORDER AND PRELIMINARY INJUNCTION The Copyright Act provides that injunctive relief is an appropriate remedy for the infringement of a copyright: Any court having jurisdiction of a civil action arising under this title may . . . grant temporary and final injunctions on such terms as it may deem reasonable to prevent or restrain infringement of a copyright. 17 U.S.C. ' 502(a) (emphasis supplied). In the Ninth Circuit, a party seeking preliminary injunctive relief must show: "(1) a likelihood of success on the merits and the possibility of irreparable injury, or (2) the existence of serious questions going to the merits and the balance of hardships tipping in its [the copyright owner's] favor." Apple Computer. Inc. v. Formula Int'l. Inc., 725 F.2d 521, 523 (9th Cir. 1984); Beltran v. Myers, 677 F.2d 1317, 1320 (9th Cir. 1982); Alekna~ik Natives, Ltd. v. Andrus, 648 F.2d 496, 502 (9th Cir. 1980); see, Lockheed Missile & Space Co. V. Hughes Aircraft Co., 887 F. Supp 1320, 1323 (ND. Cal. 1995) ("The standard for issuing a temporary restraining order is identical to the standard for issuing a preliminary [footnote] 14 See point III, ante. [end footnote] injunction."), Religious Technology Center v. Netcom, Slip. op at 5, n.8 (N.D. Cal. Sept.22, 1995) (RTC v. Netcom) (same). The two standards actually are not separate tests but are the "outer reaches" of a single continuum such that the greater the balance of hardships tips in favor of the moving party, the less likelihood of success on the merits need be shown. Apple Computer. Inc. v. Formula Int'l. Inc., 562 F. Supp. 775, 783 (C.D. Cal. 1983) aff'd 725 F.2d 521(9th Cir. 1984); Los Angeles Memorial Coliseum V. NEL, 634 F.2d 1197 1201(9th Cir. 1980). A. Plaintiff Has Established A Likelihood Of Success On The Merits Ownership of these copyrighted works is clearly established. The certificates of registration provide prima facie proof of validity and ownership of the copyrights. 17 U.S.C. ' 410(c); Triad Svs. Corp. v. Southeastern Express Co., 64 F.3d 1330, 1335 (9th Cir. 1995) cert. denied ____ S. Ct. ____ 1995 WL 699118 (1996); Transito Inc. v. Ajac Transmission Parts Corn., 768 F.2d 1001, 1019 (9th Cir. 1985), cert. denied, 474 U.S. 1059, 106 S.Ct. 802 (1986). RTC has shown both acts of infringement and an imminent threat of even more massive infringement that fully justifies swift judicial intervention. Similarly, plaintiffs religious scriptures have already been recognized by courts as valid enforceable trade secrets under the UTSA, e.it., Vien, 829 F. Supp. at 633, and Henson's threatened unauthorized acquisition and disclosure are clear. Furthermore, extraordinary measures have been taken by RTC and its predecessors to maintain the confidentiality of these trade secrets. E.it., RTC v. Netcom, Slip Op. at 27 ("The court finds that RTC has put forward sufficient evidence that it took steps that were reasonable under the circumstances to protect its purported trade secrets. RTC's president describes elaborate means taken to ensure the confidentiality of the Advanced Technology works, including use of locked cabinets, safes, logging and identification of the materials, availability of the materials at only a handful of sites worldwide, electronic sensors attached to documents, locked briefcases for transporting works, alarms, photo identifications, security personnel, and confidentiality agreements for all of those given access to the materials.") From Henson's own postings, it can be anticipated that he will raise his his First Amendment right to express his opinion regarding plaintiffs alleged bad conduct. This action is not intended or designed to keep Henson from speaking his mind, just to refrain from violating plaintiff's intellectual property [page break] Act are addressed through application of the fair use doctrine. Harper & Row Publishers. Inc. v Nation Enterprises, Inc., 441 U.S. 539, 559, 105 S. Ct. 2218, 2229-30 (1985) (refusing to expand fair use doctrine to encompass First Amendment concerns of news reporting on matters of public concern); Bo," Expoii Co. Eslablishineni V. Columbia Broadeasung System, Inc., 672 F.2d 1095, 1099 (2nd Cir.), cci'. denied, 459 U.S. 826, 103 S. Ct. 60, 74 L.Ed.2d 63 (1982) ("[n]o Circuit that has considered the question... has ever held that the First Amendment provides a privilege in the copyright field distinct from the accommodation embodied in the 'fair use' doctrine"). However, there can not be the slightest doubt that wholesale postings -equivalent to an on-line copy machine duplicating verbatim the copyrighted works- cannot possibly constitute fair use.'5 Furthermore, with respect to trade secrets, Henson's 5 position is even more fundamentally flawed-there is no fair use defense to trade secret misappropriation. See Computer Associates v. Altai. Inc 982 F.2d 693, 719 (2d Cir. 1992) (fact that defendant did not engage in copyright infringement of a program's expression does not preclude trade secret claim as to the underlying information). B. Plaintiff Will Be Irreparably Injured If Defendant Is Not Preliminarily Enjoined As a general rule, if the holder of the copyright establishes a probability of success on the merits, a court will presume irreparable harm. Johnson Controls. Inc. v. Phoenix Control Sys. Inc., 886 F.2d 1173, 1174 (9th Cir. 1989). See, Triad, 64 F.3d at 1335 n. 9 ("A copyright plaintiff who makes out a prima facie case of infringement is entitled to a preliminary injunction without a detailed showing of irreparable harm") (quotations omitted); Wainwright Sec. v. Wall Street Transcript Corp., 558 F.2d 91, 94 (2d Cir. 1977), cert. denied, 434 U.S. 1014, 98 S.Ct. 730 (1978) ("[I]f probable success - a prima facie case of copyright infringement - can be shown, the allegations of irreparable injury need not be very detailed, because such injury can normally be presumed when a copyright is infringed."). Here, the danger of irreparable injury is even greater than in the usual case, because defendant [footnote] '~ The RTC copyright that Henson has infringed has been registered as part of a collection under 37 C.F.R. '' 202.03(b)(3)(B). Each of the separate works included in such a collection is protected individually and has been infringed by defendant's wholesale reproductions and/or transmissions See American Geoohysical Union v. Texaco, 802 F.Supp 1, 17, afi'd 60 F.3d 913 (2d Cir. 1994); Szabo V. Errisson, 68 F.3d 940, 913 (5th Cir. 1995). Likewise, Henson's copying, and threat to post, the entirety of the NOTs series is infringement, not fair use. [end footnote] threatens to copy and electronically disseminate previously unpublished works that RTC has itself decided not to publish and the information in which it vigorously protects as trade secrets. The very lack of control over such copying and dissemination constitutes irreparable injury sufficient to support the issuance of a preliminary injunction. C. The Equities Weigh Heavily In Favor of Granting The Temporary Restraining Order And Preliminary Injunction In this case, all equitable considerations lie on the side of RTC and weigh heavily in favor of granting a temporary restraining order and preliminary injunction. If relief is denied, plaintiff will suffer severe and irreparable harm as a result of Henson's violation of plaintiff's exclusive rights in the copyrighted works and trade secrets at issue in this case. Even if defendant could show any harm as a result of the requested injunctive relief, such harm should not enter into the Court's consideration. Where a defendant acts with full knowledge of the plaintiff's rights and with an understanding of the consequences which might ensue, there is no balancing of equities. Morgan V. Veach, 59 Cal.App.2d 682, 690, 139 P.2d 976, 980 (1943); People ex rel. Younger v. F.E. Crites. Inc., 51 Cal.App.3d 961, 968, 124 Cal.Rptr. 664, 668 (1975). By his own admission, Henson acted with full knowledge of RTC's intellectual property rights. (McShane Dec., 66 3-8, and Ex. 1 and 2.) His wrongful acts are therefore intentional, without justification and mandate swift injunctive relief. D. Defendant Should Not Be Given Notice Prior To Issuance Of The Temporary Restraining Order In view of the nature of Henson's actions and threats challenging plaintiff's rights and this Court's authority, and his flagrant disregard for RTC's rights and this Court's authority, RTC reluctantly seeks ex parte relief. RTC is concerned that, despite Henson's stated willingness to accept service of papers from RTC's counsel, in the interim between being notified and accepting those papers, he is apt to engage in the immediate electronic transmission of any of plaintiff's copyrighted works and trade secret materials in his possession and the destruction of evidence relating to his acts. (Declaration of Thomas R. Hogan.) Accordingly, this Court should grant the temporary relief sought without notice to defendant. Further, if Henson is given any opportunity to disseminate, dispose of, or hide his unauthorized [They screwed up and duplicated the above paragraph on the next page Sloppy, sloppy, Helena.] D. Defendant Should Not Be Given Notice Prior To Issuance Of The Temporary Restraining Order In view of the nature of Henson's actions and threats challenging plaintiffs rights and this Court's authority, and his flagrant disregard for RTC's rights and this Court's authority, RTC reluctantly seeks ex parte relief. RTC is concerned that, despite Henson's stated willingness to accept service of papers from RTC's counsel, in the interim between being notified and accepting those papers, he is apt to engage in the immediate electronic transmission of any of the plaintiff's copyrighted works and trade secret materials in his possession and the destruction of evidence relating to his acts. (Declaration of Thomas R. Hogan.) Accordingly, this Court should grant the temporary relief sought without notice to defendant. Further, if Henson is given any opportunity to disseminate, dispose of, or hide his unauthorized copies after he learns of this litigation, but before he is enjoined from doing so, the irreparable damage to plaintiff will be greatly exacerbated and this litigation could well become fruitless. (McShane Dec., 66 47-48.) The law does not require notice under these circumstances. To the contrary, a temporary restraining order should issue ex Parte. Matter of Vuitton et Fils S.A., 606 F.2d 1, 3 (2d Cir. 1979); American Can Co. v. Mansukhani, 742 F.2d 314, 321-25 (7th Cir. 1984). VI RTC'S MOTION FOR EXPEDITED DISCOVERY SHOULD BE GRANTED Expedited discovery is mandated in this case so that RTC can verify the identity and source of the infringing materials in Henson's possession, the identities of those participating with Henson -- or with whom he is participating -- in his efforts to destroy RTC's trade secrets and infringe its copyrights. While it is uniformly recognized that such expedited discovery is an appropriate and necessary companion to the grant of a temporary restraining order. Metro-Goldwyn-Maver Inc. v. American Honda Motors Co., 900 F. Supp. 1287, 1292 (C.D. Cal. 1995) (permitting plaintiffs to conduct expedited discovery upon motion for preliminary injunction in copyright infringement action); Fimab- Finanziaria Ma~lificio Ftc. v. Kitchen, 548 F. Supp. 248, 249 (S.D. Fla. 1982) (noting that there is "burgeoning case law around the country which has recognized and approved as both appropriate and necessary judicial relief the granting of temporary restraining orders without notice, [and] expedited discovery"), plaintiff seeks to depose Henson after he has had an opportunity to appear before the Court and be heard. [page break] To the extent this Court finds that Henson is not already bound by the preliminary injunction motion in Ward, it is imperative that expedited discovery be granted to RTC. If immediate discovery does not proceed, RTC's attempts to protect its rights could be rendered nugatory in an electronic instant. The injury RTC will suffer if this critical evidence is deleted or destroyed looms large, while there is no conceivable injury to Henson by the grant of expedited discovery CONCLUSION For the foregoing reasons, RTC's request for a temporary restraining order, order to show cause for preliminary injunction, and expedited discovery should be granted in all respects. Dated: April 4, 1996 Respectfully submitted, Thomas R. Hogan LAW OFFICES OF THOMAS R. HOGAN Roger M. Milgrim William M. Hart PAUL, HASTINGS, JANOFSKY & WALKER -and- Helena K. Kobrin Attorneys for Plaintiff RELIGIOUS TECHNOLOGY CENTER [Hogan signed this one]