UNITED ST ATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
------------------------------------x
REIS, INC. and REIS SERVICES, LLC,
Plaintiffs,
-against-
LENNAR CORP., RIALTO CAPITAL:
MANAGEMENT, LLC, and RIAL TO CAP IT AL:
ADVISORS OF NEW YORK, LLC,
Defendants.
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GEORGE B. DANIELS, United States District Judge:
MEMORANDUM DECISION
AND ORDER
15 Civ. 7905 (GBD)
Plaintiffs Reis, Inc. and Reis Services, LLC (together "Reis") bring this action against
Defendants Lennar Corporation ("Lennar"), Rialto Capital Management, LLC ("Rialto"), and
Rialto Capital Advisors of New York, LLC ("Rialto NY") under the Computer Fraud and Abuse
Act ("CFAA"), 18 U.S.C. § 1030; the Copyright Act, 17 U.S.C. § 101, et seq. (Compl., ECF No.
1, iJiJ 41-90.) Plaintiffs also bring common law claims for fraud, breach of contract, conversion,
theft, misappropriation, unjust enrichment, and quantum meruit, as well as civil conspiracy and/or
aiding and abetting claims based on the above predicate causes of action. (Id. iii! 91-1 71.)
This action arises out of two separate sets of alleged data piracy by Defendants. The first
involves a Rialto employee's unauthorized use of Plaintiffs' proprietary database to allegedly
download approximately $1.6 million worth of real estate market analysis reports at the behest of
Lennar and its subsidiary, Rialto. (Id. iii! 4-5, 11, 31-35.) The second involves about $277,000 of
reports downloaded between May 2013 and August 2015 by two unknown IP addresses using the
credentials of database subscriber Rialto NY, another subsidiary of Lennar. (Id., iii! 6-7, 12, 36-
37.) Plaintiffs seek, inter alia, payment of compensatory, statutory, and punitive damages,
attorney's fees and expenses, as well as any other "just and proper" relief. (Id., at 29.)
Case 1:15-cv-07905-GBD Document 40 Filed 07/05/16 Page 1 of 13
Defendants move to dismiss the Complaint for failure to state a claim pursuant to Federal
Rule of Civil Procedure 12(b)(6). (Mot. to Dismiss, ECF No. 17; Defs.' Mem. in Supp. of Mot.
to Dismiss ("Mem."), ECF No. 18, at 1.)
Defendants' motion to dismiss Plaintiffs' claims under the CF AA and for secondary federal
copyright infringement is GRANTED. This Court declines to exercise supplemental jurisdiction
over Plaintiffs' remaining state law claims.
I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY
Defendant Lennar is a Delaware corporation based in Florida with a focus on building
single-family homes throughout the United States. (Mem., at 2.) Defendant Rialto, an "indirect
subsidiary of Lennar," is a real estate investment and asset management company headquartered
in Florida. (Compl. ~ 11; Mem., at 2.) Defendant Rialto NY is "an investment adviser firm and
is also a subsidiary of Lennar." (Mem., at 3; see also Compl. ~ 12.)
Plaintiffs are proprietors of a database containing detailed commercial real estate market
information encompassing 275 of the largest metropolitan markets in the United States. (Compl.
~ii 2, 19-20.) Plaintiffs compile and sell this data to real estate professionals in the form of
subscription plans or individual reports that "quantify and assess the risks of default and loss
associated with mortgages, properties, portfolios, and real-estate-backed-securities." (Id. ~~ 2-3,
16-17.) Plaintiffs own copyrights in a number of their reports, and those copyrights are registered
with the United States Copyright Office. (See id. ~~ 24-25; id., Ex. A ("List of Copyrighted
Reports").)
There are various subscription levels to the database, priced according to the amount of
data purchased, number of licenses associated with a subscription, and frequency of its access by
subscribers. (Id. ~ 20.) According to Plaintiffs, since "[m Jost professional real estate investors do
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not want to devote the resources to creating an in-house infrastructure capable of performing
[Reis'] work," those investors subscribe to Reis' services. (Id. ~ 17.) Plaintiffs also contend that
because the information in these reports is highly valuable, the database has become a target for
data pirates 1 and others who wish to benefit from this data without paying. (Id.~ 3.)
Plaintiffs allege that they protect their database with a firewall that requires secure
passwords tailored to the level of access a subscriber has purchased. (Id. ~ 25.) "To protect its
proprietary rights, Reis also relies on, among other things, restrictive license agreements" that
allow a company to purchase licenses for "an agreed number of employees or other users
associated with the company." (Id. ~~ 25-26.) Each employee receives her own login credentials-
a unique username and password-to access the database. (Id. ~ 26.)
According to Plaintiffs, users may not share passwords with anyone, not even colleagues
who work for the same subscriber. (Id., ii 27.) Once employment with a subscriber ends, a person
may not take their credentials with them to use at her new employment. (Id.) Specifically, Reis'
Terms of Service (''TOS") and its subscriber agreements "explicitly prohibit its licensees to 'resell
or transfer ... use of or access to' the Reis Database." (Id.) The TOS also states that "' [ t ]ransfer
or assignment of your password and user name to another individual is strictly prohibited."' (Id.;
Deel. of Kuangyan Huang in Supp. of Defs.' Mot. to Dismiss ("Huang Deel."), ECF No. 20, Ex.
A, at 2.) Plaintiffs maintain the TOS, as well as the Anti-Piracy Policy, is "prominently displayed"
on the database sign-in page under the heading "LEGAL" to provide users with notice that they
are legally bound when they agree to use the service. (Id. ii 30.)
1 Reis' Anti-Piracy Policy defines piracy as "using our service without a license to do so, enabling or trying
to enable a third party who is not authorized to use our service to use our service, or exceeding the scope
of uses permitted [to] you under a license agreement between you and Reis." (Comp!. ii 29.)
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Plaintiffs further allege that they started a general ongoing investigation of suspicious
access patterns as early as June 2014. (See id~~ 49, 54.) According to Plaintiffs, their Compliance
Group, which "investigates unusual patterns of use and other signs of possible [data] theft[,]" (id.
~ 3 3 ), discovered the first instance of unauthorized usage on which they base their claims against
Rialto and Lennar in June 2015. (Id.~~ 3, 33.) Specifically, Plaintiffs contend that between
December 2009 and October 2010, a Rialto employee, Harvey Lederman, used Reis database
credentials issued by his previous employer, GE Capital (who is not a party to this action), to log
in 871 times and download 4,548 Reis reports (with an alleged retail value of $1,629,9482) "in
support of Lennar and Rialto's business." (Id ~~ 4, 32.) Plaintiffs allege that during this
timeframe, "Lennar was in the process of launching Rialto" and announced that the 2010 fourth
quarter and fiscal year was marked by the "first closing of our Rialto real estate investment fund
with initial equity commitments of approximately $300 million (including $75 million committed
by us)." (Id ~ 34.) According to Plaintiffs, neither Rialto nor Lennar had legitimate access to the
Reis database until Rialto NY purchased a subscription in November 2010-about a month after
Lederman stopped downloading reports with his GE Capital-issued credentials. (Id ~ 35.)
Therefore, Plaintiffs allege that Rialto and Lennar's intrusion into the database using Mr.
Lederman's GE Capital credentials was "knowing and willful because Defendants and their
employees knew that Lennar and Rialto were not authorized licensees of Reis ... [and] knew that
Lennar and Rialto had not paid for access to the Reis Database ... . "(Id.~ 38.)
Plaintiffs contend that their June 2015 discovery of the allegedly illegal usage led them to
more closely investigate the database usage associated with Rialto NY's credentials. (Id ~ 6.)
2 According to Plaintiffs, the alleged Joss of approximately $1.6 million is based on the individual retail value of
each of the 4,548 reports if those reports were downloaded without a subscription. (See March 31, 2016 Oral Arg.
Tr. ("Tr."), at 76: I 0-77: 11.)
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According to Plaintiffs, this investigation revealed a second act of alleged piracy, this time by
unidentified individuals from two IP addresses-67.136.101.2 and 173.11.106.97-who accessed
the database through Rialto NY's credentials. (Id.) These unknown users used Rialto NY's
credentials "to download at least 7 4 7 proprietary Reis reports," worth $277 ,412 in retail value and
some in which Plaintiffs own copyrights, between May 2013 and August 2015. (Id. il 36.)
Plaintiffs therefore allege that Lennar, Rialto, and Rialto NY all "knew that the unidentified users
with whom [Rialto NY] shared its credentials were not authorized licensees of Reis ... [,]" in
violation of Rialto NY's contract with Plaintiffs, as well as Plaintiffs' Terms of Service. (Id. i!il 7,
38-39.)
II. LEGAL STANDARD
To survive a motion to dismiss, "a complaint must contain sufficient factual matter,
accepted as true, to 'state a claim to relief that is plausible on its face."' As hero fl v. Iqbal, 556
U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). The plaintiff
must demonstrate "more than a sheer possibility that a defendant has acted unlawfully"; stating a
facially plausible claim requires pleading facts that enable the court "to draw the reasonable
inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678. Thus,
the factual allegations pleaded "must be enough to raise a right to relief above the speculative
level." Twombly, 550 U.S. at 555.
A district court must first review a plaintiffs complaint to identify allegations that,
"because they are no more than conclusions, are not entitled to the assumption of truth." Iqbal,
556 U.S. at 679. The court then considers whether Plaintiffs remaining well-pleaded factual
allegations, assumed to be true, "plausibly give rise to an entitlement to relief." Id.; see also
Targum v. Citrin Cooperman & Co., LLP, No. 12 CIV. 6909, 2013 WL 6087400, at *3 (S.D.N.Y.
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Nov. 19, 2013). In deciding the 12(b)(6) motion, the court accepts the complaint's well-pleaded
factual allegations as true and draws all reasonable inferences in the non-moving party's favor.
See NJ Carpenters Health Fund v. Royal Bank of Scotland Grp., PLC, 709 F.3d 109, 119 (2d Cir.
2013).
"In deciding a motion to dismiss under Rule 12(b)(6), the court may refer 'to documents
attached to the complaint as an exhibit or incorporated in it by reference, to matters of which
judicial notice may be taken, or to documents either in plaintiffs' possession or of which plaintiffs
had knowledge and relied on in bringing suit."' Fishbein v. Miranda, 670 F. Supp. 2d 264, 271
(S.D.N.Y. 2009), aff'd sub nom. Silverman v. Teamsters Local 210 Affiliated Health & Ins. Fund,
761 F.3d 277 (2d Cir. 2014) (quoting Brass v. Am. Film Tech., Inc., 987 F.2d 142, 150 (2d Cir.
1993)); see also Hayes v. Coughlin, No. 87 Civ. 7401, 1991WL220963, at *l (S.D.N.Y. Oct. 16,
1991) ("Papers outside a complaint may be incorporated by reference into the complaint when
such papers are referred to within the body of the complaint.").
III. SECONDARY COPYRIGHT INFRINGEMENT CLAIMS
In Counts III and IV, Plaintiffs allege contributory and vicarious copyright infringement
claims against Rialto NY under the Copyright Act, 17 U.S.C. § 101, et seq, based on the second
alleged incidence of data piracy from May 2013 and August 2015. (See Compl. ~ 36.)
Specifically, Plaintiffs claim that Rialto NY knowingly shared valid Reis login credentials in
violation of its subscription agreement with the Unauthorized Doe Users, who used those
credentials to download "at least 7 4 7 proprietary Reis reports having a retail value of $277,412,"
including the nine reports to which Plaintiffs hold the copyrights. (Compl., ~~ 7, 24, 76-90.)
To withstand Defendants' motion to dismiss, Plaintiffs must "plead[] factual content" for
each element of the claim asserted such that "the court [can] draw the reasonable inference that
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the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678. "Neither contributory
nor v1canous copyright infringement can exist without an underlying finding of direct
infringement." Alexander v. Murdoch, No. 10 CIV. 5613, 2011WL2802899, at *17 (S.D.N.Y.
May 27, 2011) (dismissing claims for contributory and vicarious copyright infringement where
plaintiff failed to allege direct infringement); see also, Metro-Goldwyn-Mayer Studios Inc. v.
Grokster, Ltd., 545 U.S. 913, 930 (2005) ("One infringes contributorily by intentionally inducing
or encouraging direct infringement . . . and infringes vicariously by profiting from direct
infringement while declining to exercise a right to stop or limit it .... ")(internal citations omitted);
Faulkner v. Nat 'l Geographic Enters. Inc., 409 F.3d 26, 40 (2d Cir. 2005) ("[T]here can be no
contributory infringement absent actual infringement.").
Defendants argue that because "Reis cannot credibly allege that the 'unknown' 'DOE'
users were also 'unauthorized,' there is no primary violation of the law here." (Mem. at 24.) The
Complaint offers no information or facts alleging that the Doe Users were primary infringers on
which to base the secondary infringement claims Plaintiffs bring against Rialto NY. See Patrick
Collins, Inc. v. John Doe I, 945 F. Supp. 2d 367, 375 (E.D.N.Y. 2013) (finding that plaintiff had
"adequately pled a plausible claim of primary copyright infringement by providing sufficient
detail" of defendant's infringing conduct) (emphasis added) (citing John Wiley & Sons, Inc. v. Doe
Nos. 1-30, 284 F.R.D. 185, 189 (S.D.N.Y. 2012)). Indeed, Plaintiffs do not bring any primary
copyright infringement claims against any Defendant. (See Compl. ~~ 76-90.)
Without alleging a primary copyright infringement, Plaintiffs claims for secondary
infringement are deficient. See Faulkner, 409 F.3d 40; Wolk v. Kodak Imaging Network, Inc., 840
F. Supp. 2d 724, 750 (S.D.N.Y. 2012) ("[I]n order to hold a defendant secondarily liable someone
else must have directly infringed on the copyright holder's rights."); Matthew Bender & Co. v.
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West Publ'g Co., 158 F.3d 693, 706 (2d Cir. 1998) (same) (internal citations omitted).
Furthermore, as Defendants state in their Reply brief, Reis has not responded to Defendants'
arguments regarding secondary copyright infringement. (Reply, at 10.) As Plaintiffs have failed
to sufficiently allege secondary copyright infringement claims against Defendants, Defendants'
motion to dismiss is granted as to Counts III and IV.
IV. CFAA CLAIMS
The CF AA is a criminal statute that penalizes unauthorized access to protected computers
with intent to defraud or cause damage. See 18 U.S.C. § 1030(a). The text of the civil enforcement
provision, § 1030(g), provides:
Any person who suffers damage or loss by reason of a violation of this section may
maintain a civil action against the violator to obtain compensatory damages and
injunctive relief or other equitable relief. A civil action for a violation of this section
may be brought only if the conduct involves 1 of the factors set forth in subclause[]
(I), (II), (III), (IV), or (V) of subsection (c)(4)(A) (i). Damages for a violation
involving only conduct described in subsection (c)(4)(A)(i)(I) are limited to
economic damages ....
18 U.S.C. § 1030(g). The only potential basis for liability in this case on the facts as Plaintiffs
allege is subclause (I), which provides that an action may be brought if a plaintiff alleges a "loss
to 1 or more persons during any 1-year period ... aggregating at least $5,000 in value." 18 U.S.C.
§ 1030(c)(4)(A)(i)(I). Therefore, to state a claim for loss in excess of$5,000, Plaintiffs must plead
that Defendants: "( 1) accessed a 'protected computer'; (2) 'without any authorization or exceeding
its authorized access'; and (3) caused 'loss' in excess of $5,000." Liveperson, Inc. v. 2417
Customer, Inc., 83 F. Supp. 3d 501, 511 (S.D.N.Y. 2015) (citing 18 U.S.C. § 1030(g) referencing
18 U.S.C. § 1030(a)(2) and§ 1030(a)(5)).
As the parties do not dispute the first two elements-that the Reis database is a "protected
computer" as defined by the statute and that, at minimum, Lederman exceeded his authorized
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access-the dispositive issue is whether Plaintiffs have alleged facts that allow them to meet
jurisdictional threshold of $5,000 of either damage or loss. See Nexans Wires SA. v. Sark-USA,
Inc. ("Nexans I"), 319 F. Supp. 2d 468, 472 (S.D.N.Y. 2004) (citing Theofel v. Farey-Jones, 341
F.3d 978, 986 n. 5 (9th Cir. 2003) amended by 359 F.3d 1066 (9th Cir. 2004)), ajf'd, Nexans Wires
SA. v. Sark-USA, Inc. ("Nexans IF'), 166 F. App'x 559 (2d Cir. 2006).
18 U .S.C. § 1030( e )(8) defines "damage" as "any impairment to the integrity or availability
of data, a program, a system, or information," and "loss" as:
[a ]ny reasonable cost to any victim, including the cost of responding to an offense,
conducting a damage assessment, and restoring the data, program, system, or
information to its condition prior to the offense, and any revenue lost, cost
incurred, or other consequential damages incurred because of interruption of
service.
18 U.S.C. § 1030(e)(l l). "Both loss and damage must relate to the victim's computer systems."
Liveperson, 83 F. Supp. 3d at 514 (citing Nexans I, 319 F. Supp. 2d at 477; Civic Ctr. Motors, Ltd.
v. Mason St. Imp. Cars, Ltd., 387 F. Supp. 2d 378, 381-82 (S.D.N.Y. 2005). This means that
Plaintiffs "must establish that the Defendant[ s] intended to impair the [plaintiffs'] service." In re
iPhone Application Litig, 844 F. Supp. 2d 1040, 1067 (N.D. Cal. 2012) (citing Czech v. Wall
Street on Demand, Inc., 674 F. Supp. 2d 1102, 1115 (D. Minn. 2009)).
The losses Plaintiffs have alleged are (1) lost retail value of the reports and (2) losses related
the development of their investigatory software and its deployment during 2014 and 2015 to
identify database piracy. (Comp!.,~~ 47, 49, 54-55.) Defendants correctly contend that Plaintiffs
have failed to state a claim under the CF AA because Plaintiff have not adequately alleged loss
cognizable under the CFAA. (Mem. at 8, 11.)
As to the first type of loss alleged, Plaintiffs' "lost retail value" of about $1,629,948,
(Comp I.~ 55), from downloaded reports is not a loss covered by the CF AA. See Schatzki v. Weiser
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Capital Mgmt., LLC, No. 10 Civ. 4685, 2012 WL 2568973, at *3 (S.D.N.Y. Jul. 3, 2012) ('"Loss'
is interpreted narrowly, however, and it 'includes only costs actually related to computers."')
(quoting Garland-Sash v. Lewis, No. 05 Civ. 6827, 2011 WL 6188712, at *4 (S.D.N.Y. Dec. 6,
2011)); (see Mem. at 8; Compl. ~ 45); see also Orbit One Commc 'ns, Inc. v. Numerex Corp., 692
F. Supp. 2d 373, 386 (S. D. N. Y. 2010) (concluding that the CFAA does not apply to a competitive
injury arising from misappropriated information, but only for damage to a computing system).
With regard to the expenditures of "at least $5,000 in value," (Compl. ~ 47) related to
investigating unauthorized access to the database, Plaintiffs allege the following:
49. As part of the on-going investigation of Defendants' access and use of the Reis
Database, Reis developed its own proprietary investigatory software at a cost of
$76,364 in hourly wages of Reis developers from June 2014 through May
2015 ....
54. In addition, Reis's Vice President of Product Development and Intellectual
Property spent on average $4,900 per month of time in 2014 and 2015 using this
investigatory software tool to identify piracy. The value of the Reis employees'
time in investigating the Defendants' access and use of Reis's computer system
exceeded $5,000 in one calendar year.
(Compl. ~~ 49, 54.)
While the CF AA defines loss as"[ a ]ny reasonable cost" such as the "cost of responding to
an offense, conducting a damage assessment, and restoring the data, program, system, or
information to its condition prior to the offense," Plaintiffs' allegations that they engaged in "an
investigation into the intrusion and a damages assessment" do not meet the l 2(b )( 6) standard for
two reasons. 18 U.S.C. § 1030(e)(l l). First, Plaintiffs fail to allege that they sought to "restor[e]
the data, program, system or information to its condition prior to the offense[,]" as required by
courts in this Circuit. S'ee, e.g., Fink v. Time Warner Cable, 810 F. Supp. 2d 633, 641 (S.D.N.Y.
2011) (holding that "losses relating to time and effort in assessing 'damage' to each computer
whose transmissions were interrupted" are outside of those contemplated by the scope of the
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CF AA because the plaintiffs did not allege "that they needed to restore[] ... data, [a] program, [a]
system, or information to its condition prior to Defendant's conduct") (emphasis added) (internal
quotation marks and citation omitted). Plaintiffs merely allege that that the purpose of its
investigations were to "identify piracy," (see Comp. ii 54), by "identify[ing] suspicious patterns of
usage" and "determin[ing] whether the usage is licensed or not." (Id. iii! 51-52.) It is true that
"physical damage to a computer is not necessary to allege damage or loss," Bose v. Interclick, Inc.,
No. 10 Civ. 9183, 2011WL4343517 (S.D.N.Y. Aug. 17, 2011) (internal citation omitted), nor is
loss "lessened merely because fortuitously no physical damage was allegedly caused to the
computer system or software." Kaufman v. Nest Seekers, LLC, No. 05 CV 6782, 2006 WL
2807177 (S.D.N.Y. Sept. 26, 2006) (internal citation omitted). However, in this case, Plaintiffs
make no allegations that the investigation was for the purpose of looking into any damage to data,
programs, or server system, other than the conclusory statement that they "expend[ ed] time,
money, and resources (aggregating at least $5,000 in value) to conduct an investigation into the
intrusion and a damages assessment." (Compl. ii 47.)
Second, the case law in this Circuit "requires a cost constituting a loss to be directed in
some way at the effects of the prior intrusion, not at those of some potential future offense." See
Int 'l Chauffeured Serv., Inc. v. Fast Operating Corp., No. 11 Civ. 2662, 2012 WL 1279825, at *4
(S.D.N.Y. Apr. 16, 2012) (citing Univ. Sports Publ'ns Co. v. Playmakers Media Co., 725 F. Supp.
2d 378, 388 (S.D.N. Y. 2010) (internal citation omitted)). According to Plaintiffs' allegations, Reis
"discovered the unauthorized usage that forms the basis of Reis' claims against Lennar and Rialto
in June 2015." (See Comp!. iii! 3, 33.) However, fatal to Plaintiffs complaint is that Reis spent
the $76,364 of hourly wage time developing "proprietary investigatory software" from June 2014
to May 2015 before Plaintiffs discovered Defendants alleged unauthorized usage. (See Comp., ii
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49.) Indeed, Plaintiffs conceded as much at the March 31, 2016 oral argument. (See Oral Arg.
Tr., 70:20-71 :2.3) The CF AA permits recovery only for "expenses incurred 'to identify and
address damage caused by the security breach that had already taken place,"' not prophylactic
costs. Cohen v. Gerson Lehrman Grp., Inc., No. 09 Civ. 4352, 2011WL4336683, at *8 (S.D.N.Y.
Sept. 15, 2011) (quoting University Sports Puhl 'g Co. v. Playmakers Media Co., 725 F. Supp. 2d
378, 388 (S.D.N.Y. 2010)).
Furthermore, Plaintiffs do not specify which portion of any investigatory expenses resulted
from Defendants' conduct. See Liveperson, 83 F. Supp. 3d at 514 ("The former does not specify
what portion of the over $75,000 in damages constitute either loss or damage under the Act, i.e.
whether $5,000 or more of the damages alleged are attributable to the CFAA claim."). Plaintiffs
merely allege that "Reis's Vice President of Product Development and Intellectual Property spent
on average $4,900 per month of time in 20 I 4 and 20 l 5 using this investigatory software tool to
identify piracy." (Compl. ~ 54) (emphasis added). The bald assertion that "the value of the Reis
employee's time in investigating the Defendants' access and use of Reis's computer system
exceeded $5,000 in one calendar year," (id.), in a calendar year where there were presumably other
purported data pirates, fails to allege which portion of these expenses were specifically due to
Defendants' access. See Liveperson, 83 F. Supp. 3d at 514. Plaintiffs have therefore failed to
allege that they have met the $5,000 jurisdictional threshold required to state a claim under the
CFAA.
3 Specifically, Plaintiff admitted the following:
Mr. Fischer: ... [W]e have developed a software because multiple users are misusing our service.
The Court: That is a decision you made before you even found out about this defendant.
Mr. Fischer: Correct. To the extent that temporal issue is the key ....
(Tr., at 70:20-71 :2.)
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As Plaintiffs failed to state a claim under the CF AA, Plaintiffs' conclusory statements that
purport to allege Defendants' participation in a conspiracy to violate the CF AA also fail. See
NetApp, Inc. v. Nimble Storage, Inc., 41 F. Supp. 3d 816, 836 (N.D. Cal. 2014); PNC Mortgage v.
Superior Mortgage Corp., CIV. A. NO. 09-5084, 2012 WL 627995, at *4 (E.D. Pa. Feb. 27, 2012);
(Compl. ii 64).
Defendants' motion to dismiss the primary and secondary CF AA claims is GRANTED.
V. STATE LAW CLAIMS
Having dismissed all claims over which it had original jurisdiction, this Court declines to
exercise supplemental jurisdiction over the remaining state law claims at this early stage in the
litigation. See 28 U.S.C. § 1367(c)(3) ("The district courts may decline to exercise supplemental
jurisdiction over a claim ... [if] the district court has dismissed all claims over which it has original
jurisdiction."); Purgess v. Sharrock, 33 F.3d 134, 138 (2d Cir. 1994) ("[T]he exercise of
supplemental jurisdiction is left to the discretion of the district court .... ") (citation omitted).
VI. CONCLUSION
Defendant's Motion to Dismiss for failure to state a claim is GRANTED as to Plaintiffs'
CF AA and secondary federal copyright claims. This court declines to exercise supplemental
jurisdiction over plaintiffs' state law claims.
The Clerk of Court is directed to close the motion at ECF No. 17 and this case.
Dated: New York, New York
July 5, 2016
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SO ORDERED.
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