California District Judge George H. Wu declined Move’s preliminary injunction request against CoStar on Monday, stating the portal failed to prove the risk of “imminent, irreparable harm.”
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California District Judge George H. Wu has declined Move’s request for a preliminary injunction against rival portal CoStar Group, according to court documents filed after a hearing between the portals on Monday.
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“The Court is not persuaded that Move has demonstrated, with evidence, likely, and imminent, irreparable harm, even if it can demonstrate past misappropriation at least on Kaminsky’s part,” Wu said in a 13-page response. “… Move has not made the ‘clear showing’ that it should be awarded the ‘extraordinary’ and ‘drastic’ remedy of a preliminary injunction. Move’s motion is denied.”
Wu’s ruling is the latest chapter in a theft of trade secrets lawsuit against CoStar Group and former Realtor.com News & Insights editor James Kaminsky, who CoStar hired in March to manage a team that writes listing descriptions for high-end condominium and co-op buildings in NYC.
After being laid off from Realtor.com in January, Kaminsky accessed roughly 40 Move-owned files, which included News & Insights team salary and bonuses, an ongoing list of Realtor.com News & Insights stories, a “2022 or 2023” presentation on audience and revenue projections, and two other files with passwords to third-party subscriptions, WordPress instructions, and staff contact numbers.
Move claimed those files included trade secrets that Kaminsky shared with CoStar Group to help the portal bolster its Homes.com traffic and search engine optimization (SEO) performance, and requested the Court grant a preliminary injunction to stop CoStar and Kaminsky’s alleged continued access to and use of “unauthorized files” as they pursued an expedited discovery.
“Move easily meets the standards for entry of a preliminary injunction and for an order authorizing limited expedited forensic discovery,” Move’s initial injunction request read. “With an appropriately crafted Order, the Court can help Move stop further misappropriation of trade secrets, ensure unauthorized access to its computer systems has stopped, prevent more spoliation, and determine where Move’s stolen information has been sent.”
Both portals have presented separate forensic expert reports before the Court over the past month.
Move’s report, which was conducted by News Corp VP of Global Cyber Defense Howard Pence, revealed Kaminsky transferred access to 40 documents during his final two days of working for Realtor.com.
“I am not aware of any legitimate business purpose for a former employee such as Mr. Kaminsky to access Move’s electronic files on the Google Docs account after his employment ended,” he said in an Aug. 28 filing. “Mr. Kaminsky was not authorized to access the Google Docs account after his employment ended.”
Roughly a week later, CoStar shared the results of its forensic report, which said Kaminsky only “minimally accessed” the files in question and never shared those files with anyone at CoStar. “Move cannot identify any change CoStar has made to its business or damage it has suffered as a result of Kaminsky’s access to the five Move documents; and CoStar’s Homes.com outperformed Realtor.com for months prior to Kaminsky joining CoStar,” the filing read.
Judge Wu said Move’s filings and forensic evidence failed to meet the requirements for a preliminary injunction, and stated they could have if they’d followed through with the initial request for an expedited discovery.
“Lacking evidence of its own (because of a failure to take advantage of an opportunity for discovery, despite its initial request for such an opportunity), Move otherwise only questions the veracity of Kaminsky in multiple regards,” he said in the filing. “But Move’s failure to take advantage of the opportunity for discovery has allowed it to either a) consider only what it believes it already knows about Kaminsky’s conduct before this lawsuit was filed (none of which involves actual disclosure of anything to CoStar) to form the basis for what Move believes [or] speculates Kaminsky might do with CoStar going forward…”
A Move spokesperson said Wu’s ruling hasn’t deterred the portal from pursuing the case, noting “the ruling is just one step in the process” and they look “forward to the discovery period and having our day in court.”
Gene Boxer | Credit: CoStar
Meanwhile, CoStar Group General Counsel Gene Boxer said they’re prepared to “fight and win this dispute on the merits” as Move remains steadfast with their claims.
“In today’s opinion, the Court noted repeatedly that Move had refused to take discovery, even when offered the chance. That is because the truth is anathema to Move’s case,” Boxer said in an emailed statement to Inman.”Rather, Move preferred to peddle a baseless narrative that CoStar was using Move documents when there was zero evidence to substantiate that claim.”
“As we have said from the beginning, this case — which Move has tried to weaponize in the press — is a PR stunt in response to the fact that Move is failing in the marketplace,” he added. “Homes.com, based on a ‘your listing, your lead’ model, which is both broker and consumer-friendly, is accelerating past Move’s failing Realtor.com. Move’s baseless claim for relief, which fell flat today, cannot change that reality.”
Read the full filing below: