P.C. Yonkers, Inc. v. Celebrations the Party and Seasonal Superstore, LLC

P.C. of Yonkers, Inc. (P.C.) (plaintiff) was a franchise of Party City Corporation, a chain of stores selling party supplies. Along with 18 other Party City affiliates, P.C. sued Celebrations the Party and Seasonal Superstore, LLC (Celebrations) (defendant) for violating the Computer Fraud and Abuse Act (CFAA) and sought injunctive relief. Celebrations was owned by former employees of Party City and sold party supplies at retail. P.C. argued that one of Celebrations’ founders accessed P.C.’s parent company’s computer servers after his employment with P.C. ended and without authorization. P.C. had no evidence demonstrating what information, if any, the Celebrations employee accessed or obtained while doing so, but it argued that Celebrations used information gleaned from P.C.’s computer systems to obtain an unfair competitive advantage by helping Celebrations select its retail locations and market its stores. P.C. sought an injunction prohibiting Celebrations from operating its stores and from using P.C.’s trade secrets. The district court questioned whether the CFAA provided for injunctive relief and, after analyzing P.C.’s motion, rejected P.C.’s request for injunctive relief. The court found that P.C. failed to demonstrate a likelihood of success on the merits of its claim by failing to show fraudulent intent by Celebrations relating to the alleged unauthorized access to P.C.’s computers. P.C. appealed.