Jenner & Block

Firm Prevails on Behalf of Pinterest Investor in Trade Secrets Case

On November 27, 2017, the firm secured a victory for one of the initial investors in the social media website Pinterest.com when the New York Supreme Court (Commercial Division, Manhattan) granted summary judgment dismissing in full claims that our client stole ideas and trade secrets that were allegedly used to build the popular site.

The plaintiffs are former Columbia Law School student Theodore Schroeder and two corporate entities formed to support his website projects, Rendezvoo LLC and Skoop Media Associates, Inc.  Mr. Schroeder and his colleagues at Rendezvoo LLC first released a website called Rendezvoo in 2005. The site allowed users to share their physical locations and personal interests with friends.  In their attempts to explore fund-raising ideas, they reached out to a non-profit angel investing consortium called New York Angels, Inc. (NYA) in 2007.  Through NYA, they met angel investor Brian S. Cohen.  Both NYA and Mr. Cohen are the firm’s clients in this action, as Mr. Schroeder also sued NYA under a theory of vicarious liability.

The plaintiffs abandoned Rendezvoo and instead worked with Mr. Cohen to create a differently focused site that they called Skoopwire.com, which was intended to be a free, direct-to-customer newswire for announcing new product launches.  In 2007, Skoopwire was refined and focus group tested, but after professional differences arose, the project was abandoned. 

More than a year later, Mr. Cohen met an entrepreneur named Ben Silbermann and decided to invest in his company, Cold Brew Labs.  At the time, Cold Brew Labs was developing and marketing an application called Tote.  It ultimately pivoted to create Pinterest, which launched in 2010.

In 2012, after Mr. Schroeder saw an article in which Mr. Cohen was quoted discussing his investment in Pinterest, the plaintiffs sued Mr. Cohen, Pinterest, and ultimately NYA as well.  They claimed that Mr. Cohen and the other defendants misappropriated the plaintiffs’ confidential and proprietary intellectual property, ideas and business plans to create Pinterest.  Pinterest was dismissed from the case early on, as the complaint did not plead any direct connection between Mr. Schroeder and Pinterest.  However, the majority of the claims against Mr. Cohen and NYA were left to be litigated on their merits.

Following extensive discovery, Mr. Cohen and NYA moved for summary judgment.  On November 27, 2017, the New York Supreme Court granted the motions, dismissing the claims against Mr. Cohen and the NYA.

In his 27-page opinion, Justice O. Peter Sherwood wrote that Mr. Cohen had showed that “there [was] nothing in the record beyond speculation that Cohen ‘stole or misused’ plaintiffs’ information, confidential or otherwise [as] plaintiffs [did] not present any evidence of [a] conveyance”; that plaintiffs’ supposed trade secrets were too vague and common to receive trade secret or other similar protection;  that the plaintiffs identified their trade secrets by improperly “cherry-picking” from different iterations of their website projects, ultimately claiming a proprietary combination of features they themselves had never used in an “attempt, in hindsight, to retroactively tailor their alleged trade secret to what was embodied in Pinterest”;  and that the information at issue was not protectable since such information was shared with “public relations firms, web designers, and focus group participants, among others, without any confidentiality agreements.”

The team representing Mr. Cohen and NYA included Partners Brian J. Fischer and Andrew H. Bart, Associate Gretchen O. Stertz, Paralegal Jeff Phillips, Legal Assistant Azza Khalifa and former associate Stephanie Krent.  Others who have contributed to the case over its long lifespan include Partner Alison I. Stein and Associates Natalie K. Orpett and Christine I. Lee.