A ft erexami ni ng t he br i efs and appe l l at e r ecor d, t hi s panel has det erm i ned * unani m ous l yt hator al ar gum entw oul d notm at er i al l yas s i s tt he det erm i nat i on of th is a p p e a l. See F e d . R . A p p . P . 3 4 (a )(2 ); 1 0 th C ir. R . 3 4 .1 (G ). T h e c a se is th e re fo re o rd e re d su b m itt e d w ith o u t o ra l ar g u m e n t. T h is o rd e r a n d ju d g m e n t is notbi ndi ng pr ece dent , exce ptundert he doctr i nes of l aw of the ca s e, r es j udi cat a, and col l at er al es t oppel . I tm aybe ci t ed, how ever , fori t s per s uas i ve val ue c o n s is te n t w ith F e d . R . A p p . P . 3 2 .1 a n d 1 0 th C ir . R . 3 2 .1 . FI LED Unite d St at e s C ourt o f Appe als

Te nt h Ci r c uit 

### S e p t e m b e r 17, 2007 Elisab eth A. Shumaker Clerk of Court UNI TED S TATES CO URT O F AP PEALS F O R T H E T E N T H C IR C U IT T R IA D C O N S U L T A N T S , IN C ., a C ol or ado corpor at i on,

P lain tiff-A p p e llan t, v. J EFFR EY A . W I G G I N S, a n in d iv id u a l,

D efe ndant - A ppel l ee. N o. 07- 1007 ( D. C. No . 0 6 - CV - 1 7 7 1 - P S F - M E H)

(D . C o lo .)

ORDE R AND J UDGM EN T * B efor e P O R F IL IO , AN DE RS ON , and BA LD OCK , C i rcui tJudg es.

T r i ad C ons ul t ant s , I nc. , appea l s fr om t he di s tr i ctcourt ’ s j udgm enti n favor o f T ri ad ’s fo rm er e m p loy ee , d efen d an t Jeff reyW igg ins. T h e d istri ct co u rt d i s mi s s e d wi t h p r ej u d i c e Tr i a d ’ s Co mp u t e rF r a u d a n d Ab u s e Ac t( CF AA) c l a i m, s ee 18 U . S. C . § 1030, fi r s tunderFed. R . C i v. P. 12( b) ( 6) and, al t ernat el y , under-2-

Fed. R . C i v. P. 56. T he courtdecl i ned t o exer ci s e s uppl ement al j ur i s di ct i on over T r i ad’ s s t at e- l aw cl ai m s and deni ed i t s m ot i on fora pr el i m i naryi nj unct i on. T r i ad appea l s onl yt he di s m i s s al of the C FA A cl ai m . W e have j ur i s di ct i on under 2 8 U .S .C . § 1 2 9 1 a n d a ffirm th e d istric t co u rt’s d ism iss a l o f th e C F A A c laim u n d er R u le 12 (b)(6 ). B ackgr ound B eca us e the part i es ar e fa m i l i arw i th the fa ct s , w e s um m ar i ze onl ythe per t i nental l egat i ons of the compl ai nt , w hi ch w e mustt ake a s true forpurpos es of deci di ng t hi s appea l underR ul e 12( b) ( 6) . T r i ad pr ovi des comput erpr ogr amm i ng and i nform at i on t echnol ogys ervi ces as w el l as r ecrui t i ng and pl ace m ents ervi ces forcomput er , dat a pr oces s i ng, and comm uni cat i ons pr ofes s i onal s . W i ggi ns w as P reside n t and C h ief O p era ti n g O fficer o f T ri ad at th e ti m e o f h is disch arg e. P art o f h is r esp o n sibil it ies i n clud ed cre ati n g an d safeg u ard ing b ac k u p tape s o f T ri ad ’s comput ers y s t em, w hi ch i nvol ved r emovi ng a bac kup t ape f r om the pr emi s es eac h d a y . E a c h b a c k u p tap e c o n tain e d a ll o f T ria d ’s e lec tro n ica llysto re d tra d e se c re ts and pr opr i et aryand conf i dent i al i nform at i on. O n Ju ly2 8 , 2 0 0 6 , T ria d ter m in a ted W ig g in s’s e m p lo ym e n t, es c o rte d h im outof the off

i ce, and r emi nded hi m thathe w as obl i gat ed t o r eturn anyT r i ad p rop ertyin h is po sses sion . O n A u g u st 18 , a fo rm er T ri ad n etw o rk a d m inistrator, Jeff M arti n , info rm ed the c o m p an ythat W igg ins a sk ed h im to b rea k into T ri ad ’s n e t wo r k s e r v e ra n d c o p yo rd o wn l o a d c o mp u t e rfi l e s , wh i c h h e r e f u s e d t o d o . On-3-

A ugus t29, M art i n i nform ed Tri ad thatW i ggi ns as ked hi m t o r es t or e a ba ckup tap e th a t W ig g in s h a d in h is p o ss e ss io n . R e sto ra tio n w o u ld c o n v e rt th e d a ta in to a us abl e form at . M art i n agr eed w i th T r i ad t o acc eptthe t ape f r om W i ggi ns and r etur n i tt o T r i ad. W i ggi ns , how ever , i nform ed M ar t i n thathe found s om eone e lse to re sto re th e tap e , o n e o f T ria d ’s c o n su lti n g p a rtn e rs. M a rtin p a ss e d th is i nform at i on al ong t o T r i ad, w hi ch then cont act ed i t s cons ul t i ng partnerand r ecove r ed the t ape on Sept ember1. T r i ad then fi l ed thi s act i on on Sept ember7, 2006. I n addi t i on t o the for egoi ng al l egat i ons , T r i ad al s o al l eged thati tbel i eved thatotherbackup t apes m ig h t b e m iss in g . In its C F A A c laim , T ria d a ss e rte d th a t W ig g in s, k n o w in g ly a n d w ith in ten t to d e f

ra u d , an d w ith o u t au th o riz a tio n o r in e x c e ss o f h is author i zat i on, acc es s ed Tri ad’ s comput er s and appr opr i at ed conf i dent i al and p ro p rie tar yb u sin e ss in fo rm a tio n , an d a ttem p ted to u se th e in fo rm a tio n fo r h is per s onal benef

i t , al l of w hi ch l ed t o l os s es of atl eas t$5, 000. T r i ad al s o as s er t ed s t at e- l aw cl ai m s and moved fora pr el i m i naryi nj unct i on. W i ggi ns ans w er ed the compl ai ntand as s ert ed s t at e- l aw count er cl ai m s r el at i ng t o compensa t i on he a lleg e d T ria d o w e d h im . H e a lso m o v e d to d ism iss th e C F A A c laim fo r fa ilu re to s t at e a c l ai m on w hi ch r el i ef c an be gr ant ed and a s ked the di s tr i ctcourtt o decl i ne to e x e rc ise su p p lem e n tal ju risd ictio n o v e r T ria d ’s s tate -la w c laim s. A ttac h e d to hi s m ot i on w as a copyof an a ffi davi tdat ed Sept ember21, 2006, thathe had s ent t o T ri ad along w i t h a seco nd back up t ape an d tw o o ther i t em s.T he C FA A i s a cr i m i nal s t atut e, butundert he por t i ons of 18 U . S. C . § 1030 1 r el evantt o T r i ad’ s C FA A cl ai m , w hoever“know i ngl yand w i th i nt entt o defr aud, acc es s es a pr ot ect ed comput erw i thoutauthor i zat i on, orexce eds author i zed acc es s , and bym eans of s uch conduc tfur ther s t he i nt ended f r aud and obt ai ns a n yth in g o f

v a lu e ” m a yb e liab le in a c iv il ac tio n to a n yp e rso n w h o a s a re su lt s uffe r s “l os s t o 1 orm or e per s ons dur i ng any1- y earper i od . . . aggr egat i ng at least $5 , 0 0 0 in v alue . ” 1 8 U . S . C . § 1 0 3 0 (a)(4), ( a)(5 )(B )(I ), (g). -4- T he di s t r i ctcour thel d t w o hear i ngs on the mot i ons , hear d t es t i m ony , and r ece i ved evi dence . A tt he conc l us i on of the s econd he ar i ng, the courti s s ued an o ral ruli n g . A s to the C F A A claim , the c o u rtfirstap p li ed R u le 12 (b)(6 )’s sta n d a rd a n d c o n c lu d e d th a t th e c o m p lain t fa iled to a lleg e tw o e ss e n tial e lem e n ts o f a C F A A v io latio n u n d e r 1 8 U .S .C . § 1 0 3 0 (a )(4 ): th a t W ig g in s e x c e e d e d h is authori zed access and t hat he ob t ai ned som et hing of value. R egardi ng access, 1 t he co urtno t ed thatt he co m plai nt al l eged t hat W i gg i ns w as aut ho ri zed to po sses s t he bac kup t apes . A s t o w hetherornotW i ggi ns obt ai ned anythi ng of val ue, t he cour tnot ed thatt he compl ai nts etfor th a s equenc e of fact s s how i ng thathe neve r ob t ai ned anyi nfo rm at i on from t he tapes. I n t he al t ernat i ve the courtt r eat ed the mot i on t o di s m i s s as one s eeki ng s um m aryj udgm entunderR ul e 56, as i thad ea r l i eradvi s ed the part i es i tm i ghtdo, and gr ant ed the mot i on as t o t he C FA A cl ai m on the gr ounds t hatT r i ad had not in c u rr e d a n yd a m a g e o r l o s s b yre a s o n o f a v io la tio n o f

th e s ta tu te , s ee 1 8 U. S . C. § 1030( g) , and thati n anyeventT r i ad’ s expendi tur e of more t han $22, 000 in v e stig a tin g th e m a tter w a s n o t a lo ss a risin g f ro m a c o u rse o f

c o n d u c t re late d to W ig g in s’s a c tio n s, a s re q u ire d b y1 8 U .S .C . § 1 0 3 0 (a )(5 ). T h e c o u rt d e c lin e d to-5-

e x e rc ise su p p lem e n tal ju risd ictio n o v e r T ria d ’s s tate -la w c laim s, d e n ied its mo t i o n fo ra p r e l i mi n a r yi nj u n c t i o n , a n d d i s mi s s e d W i g g i n s ’ s c o u n t e r c l a i ms w i t houtpr ej udi ce. T r i ad appe al ed. D i s cus s i on O n a p p e a l, T ria d tak e s is su e o n lyw ith th e d istric t co u rt’s d ism iss a l o f its C FA A cl ai m . W e affi r m on t he bas i s of the di s tr i ctcourt ’ s di s m i s s al under R u l e 1 2 ( b ) ( 6 ) a n d n e e d n o tr e a c h i t s a l t e rn a t e d i s m i s s a l u n d e rR u l e 5 6 . We re v ie w d e n o v o a d is tr ic t c o u rt ’s d is m is s a l u n d e r R u le 1 2 (b )( 6 ). See Ri dge atR ed Haw k, L. L. C . v. Schnei der , 493 F. 3d 1174, 1177 ( 10th C i r . 2007) . I n doi ng s o, “w e as s um e the trut h of the pl ai nt i ff’ s w el l - pl eade d fac tual al l egat i ons and vi ew t hem i n t he l i ghtm os tfavor abl e t o the pl ai nt i ff. ” Id. ( q u o t a t i o n o m i t t e d ) . We m u st d e ter m in e “ w h e th e r th e c o m p lain t co n tain s ‘e n o u g h fa c ts to sta te a c laim to r el i ef thati s pl aus i bl e on i t s fac e. ’ ” Id. ( quot i ng B e ll A tl. C o rp . v. Tw o m b ly , 127 S. C t . 1955, 1974 ( 2007) ) . T hus , “the compl ai ntm us tgi ve the courtr eas on t o bel i eve that[Tri ad] has a r eas onabl e l i kel i hood of m us t er i ng fac tual s uppor tfor [i t s ] cl ai m s . ” R idg e a t R e dHa w k, L .L .C . , 493 F. 3d at1177. W e nee d notdeci de w hetherW i ggi ns “ac ces s e[d] a pr ot ect ed comput er w i t houtauthor i zat i on, orexce ed[e d] author i zed a cce s s , ” orfur ther ed a f r audul ent i nt entbydoi ng s o. 18 U . S. C . § 1030( a) ( 4) . N orneed w e det erm i ne w hethertheT h e sta tu te d e fin e s “ c o m p u ter ” a s “ a n e lec tro n ic, m a g n e tic, o p tica l, 2 e lec tro c h e m ica l, or o th e r h ig h sp e e d d a ta p ro c e ss in g d e v ice p e rfo rm in g lo g ica l, ar i t hm et i c, ors t or age f unct i ons , and i ncl udes anydat a s t or age faci l i tyor comm uni cat i ons fac i l i t ydi r ect l yr el at ed t o oroper at i ng i n conj unct i on w i th s uch d e v ic e , b u t s u c h te rm d o e s n o t in c lu d e a n a u to m a te d typ e w ri te r o r t yp e s e tte r, a p o rt ab le ha n d h eld c alcu lat o r, o r oth er sim il ar d ev ice.” 1 8 U . S . C . § 1 0 3 0 (e)(1). -6- b a c k u p tap e s fa ll w ith in th e sta tu to ry d e fin iti o n o f a c o m p u ter . In ste a d , w e w ill 2 as s um e thes e el ement s of the cl ai m and foc us on the di s tr i ctcourt ’ s det erm i nat i on t hatT r i ad fa i l ed t o al l ege s uffi ci entfac t s t o s how t hatW i ggi ns “obt ai n[ed] anyt hi ng of val ue. ” Id. W e are not per suaded byT ri ad’s ar gu m ent that the tapes them sel ves, w i t houtacc es s t o t he i nform at i on theycont ai ned, w er e “a nythi ng of val ue. ” Tri ad has poi nt ed t o no cas e, and w e have found none, w her e obt ai ni ng thats or tof v a lu e — th e v a lu e o f

a sto ra g e m e d iu m a p a rt f ro m th e v a lu e o f

a n yin fo rm a tio n it c o n tain s— w a s s u fficie n t to sta te a c laim u n d e r th e C F A A . T o th e c o n tra ry , in eac h of the C FA A cas es di s cus s ed i n T r i ad’ s br i efs , acc es s t o i nform at i on w as c e n tra l to th e c laim e d v io latio n — th e in fo rm a tio n w a s e ith e r d e lete d , u se d to c o m p e te , o r g iv e n to a c o m p e tito r. S e e In t’l A irp o rt C trs ., L .L .C . v. C itrin , 4 4 0 F .3 d 4 1 8 , 4 1 9 (7 th C ir. 2 0 0 6 ) (e m p lo y e e d e lete d in fo rm a tio n p rio r to q u itt in g ); Vi C hi

p C or p. v. Lee , 438 F. Supp. 2d 1087, 1092 ( N . D . C al . 2006) (sam e); Nexans Wi r es S. A . v. Sark- USA , Inc. , 319 F. Supp. 2d 468, 469- 70, 471, ( S. D . N . Y . 2004) ( compet i t ori nduced c opy i ng and del et i on of i nform at i on by p lain tiff ’s fo rm e r e m p lo y e e s, th e n u se d c o p ied in fo rm a tio n ); P ac. A er os pace &I n a footnot e t o i t s appel l at e br i ef, T r i ad not es t hatno di s coveryhad 3 occurr ed i n t hi s cas e w hen the di s tr i ctcourti s s ued i t s or al rul i ng, and cont ends t hati thas notconce ded thatW i ggi ns fai l ed t o obt ai n anyi nform at i on fr om t he ta p e s . See A pl t . O peni ng B r . at16, n. 13. B utT r i ad’ s r el uct ance t o conce de the (c o n tin u e d ...) -7- E l ecs . , Inc. v. Tayl or , 295 F. Supp. 2d 1188, 1193, 1196 ( E . D . W as h. 2003) (fo rm e r e m p lo y e e s u se d in fo rm a tio n g lea n e d f ro m e m p lo y e r’s c o m p u ter to c o m p e te) ; Shurgar d St or age C trs . , Inc. v. Saf eguar d Sel

f St or age, Inc. , 119 F. Supp. 2d 1121, 1123, 1127 ( W . D . W as h. 2000) ( pl ai nt i ff’ s form er e m p lo y e e g a v e in fo rm a tio n to c o m p e tit o r); C . H. R obi ns on Wor ldw i de, Inc. v. Com m an d Tr an s

p. , LLC , N o . 0 5 -C -3 4 0 1 , 2 0 0 5 W L 3 0 7 7 9 9 8 , at * 2 -4 (N .D . Ill . N o v . 1 6 , 2 0 0 5 ) (un p u b li sh ed ) (fo rm er e m p loy ee s u sed info rm ati o n to co m p ete). I n s t e a d , we fi n d p e r s u a s i v e th e r e a s o n i n g o f th e F i r s tCi r c u i t , th a tCF AA “val ue i s r el at i ve t o one’ s needs and obj ect i ves . ” Uni t ed Stat es v. Cz ubi ns ki , 106 F. 3d 1069, 1078 ( 1s tC i r . 1997) . I n Cz ubi ns ki , the courtr equi r ed the g o v e rn m e n t to s h o w th a t th e in fo rm a tio n w a s v a lu a b le to th e d e fe n d a n t. Id. ; s ee als o i d. at1078- 79 ( di s cus s i ng C FA A ’ s l egi s l at i ve hi s t or ys uppor t i ng vi ew that t he s t atut e w as m eantt o pr ot ecti nform at i on as oppos ed t o m er e unauthor i zed acc es s ) . Si m i l ar l yher e, t he val ue of the t apes t o W i ggi ns ( and t o T r i ad, forthat m a tter) lay i n th e in fo rm a tio n th e tap e s c o n tain e d , n o t in th e p h y sic a l o bjec ts t hemsel ves . B eca us e Tri ad al l eged no fact s s how i ng thatW i ggi ns acc es s ed the in fo rm a tio n o n e ith e r ta p e , itc a n n o t es tab lish o n e o f th e e lem e n ts o f

a c laim u n d e r § 1 0 3 0 (a )( 4 ), th a t W ig g in s o b ta in e d “ a n yth in g o f v a lu e .” S e e P. C. 3( . . . cont i nued) 3 p o in t is b a se d o n n o th in g m o re th a n p u re sp e c u latio n a n d ru n s c o n tra ryto ( 1) T r i ad’ s al l egat i ons r egar di ng the fi r s tt ape, w hi ch s how ed thatT r i ad r ecove r ed the tap e b efo re W igg ins c o u ld g et so m eo n e to re store the d ata; an d (2) T ri ad ’s ow n t es t i m onyatt he mot i ons hear i ng, namel y , thati thad exa m i ned the t apes but c o u ld n o t s h o w th a t a n yin fo rm a tio n h a d b e e n a c c e s s e d , s ee A p lt . A p p . , V o l. II at299. A l t hough w e, l i ke the di s tr i ctcourt , do notcons i derm at t er s out s i de the compl ai ntunderR ul e 12( b) ( 6) , t he di s tr i ctcour ts t at ed thati tcoul d not“fi nd t hat di s coveryi s goi ng t o change [the] det erm i nat i on as t o [Tri ad’ s C FA A cl ai m ] . ” Id. at245. T hus , w e conc l ude thatthe di s tr i ctcour tpr oper l ybas ed i t s di s m i s s al on R ul e 12( b) ( 6) w i t houtpr ovi di ng an oppor tuni tyfordi s coveryoramendm entof t he compl ai ntr egar di ng ei t hert ape. M or eover , the di s tr i ctcour tnot ed thatatt he t i m e of i t s or al rul i ng, t he ca s e had be en pendi ng forthr ee mont hs and Tri ad had n o t s e rv e d a n yd is c o v e ry re q u e s ts o n W ig g in s . Id. , V ol . I at234. -8- Yon ke rs , Inc . v . Cel e br at i on s the Par t y & Se as on alSu

pe rs t or e , LLC , 428 F. 3d 504, 509 ( 3d C i r . 2005) ( aff i r m i ng deni al of pr el i m i naryi nj unct i ve r el i ef unde r C FA A w her e pl ai nt i ffs di d notknow , had nots how n, and coul d nots how “w hat i nform at i on, i f any , w as t aken” byform erempl oy ee w ho acc es s ed comput er w ith o u t auth o ri za ti o n ). T r i ad’ s r el i ance on Un itedS ta tes v . Will is , 4 7 6 F . 3 d 1 1 2 1 (10 th C ir . 2 0 0 7 ), i s m i s pl ace d. I n Will is , d e c id e d tw o m o n th s a f ter th e d istric t co u rt’s o ra l ru lin g in th is c a se , w e a d d re ss e d a n a rg u m e n t b ya c rim in a l d e fe n d a n t th a t th e o ffe n se w ith w h ich h e w as c h arg ed u n d er a d iffe ren t sub sec ti o n o f th e C F A A , § 1 0 3 0 (a)(2)(C ), r equi r ed pr oof of a n i nt entt o defr aud under§ 1030( a) ( 4) . W e poi nt ed outs ever al di ffe r ence s betw een the el ement s of the tw o s ubs ect i ons , among t hem t hat( a) ( 4) r equi r es onl yt hata per s on “obt ai n anythi ng of val ue, ” butthat( a) ( 2) ( C ) r equi r es a per s on t o obt ai n “i nform at i on. ” Id. at1126. B utthi s di s t i nct i on w as not-9-

n e c e ss a ryto o u r d isp o sitio n o f th e c a se ; ra th e r, w h a t m a ttere d fo r o u r p u rp o se s in Will is w a s th a t th e g o v e rn m e n t w a s n o t re q u ire d to p ro v e f ra u d u len t in ten t in o rd e r t o o b ta in a c o n v ic tio n u n d e r s u b s e c tio n (a )( 2 )( C ). Id. A nd as w e expl ai ned above, t he bac kup t apes t hemsel ves do notcons t i tut e “a nythi ng of val ue” for purpos es of a c l ai m unders ubs ect i on ( a) ( 4) i n thi s cas e abs entacc es s t o the i nform at i on t heycont ai n. C oncl us i on We c o n c l u d e t h a tT r i a d fa i l e d t o a l l e g e s u ffi c i e n tfa c t s t o s t a t e a CF AA c la im th a t is p la u s ib le o n its fa c e . S e e Tw o m b ly , 1 2 7 S . C t. at 1 9 6 9 ; R i dge atR ed Ha wk, L . L . C. , 4 9 3 F .3 d a t 1 1 7 7 . T h e ju d g m e n t o f th e d istric t co u rt is AF F I RMED . E n tered fo r th e C o u rt

Jo h n C . P o rfili o C i r cui tJ udge