Will The CFAA, An Old Anti-Hacking Law, Apply To Password Sharing?

by King & Spalding

David Nosal, an ex-employee of Korn Ferry International (“KFI”), convinced some of his former colleagues to download source lists from KFI using their log-in credentials and the log-in credentials of another employee.  In 2008, Mr. Nosal was charged with violating the Computer Fraud and Abuse Act (“CFAA”) and the Economic Espionage Act (“EEA”).  The government argued for an interpretation of the CFAA that would make a violation of a private computer use policy a federal crime.  Using the Ninth Circuit decision in LVRC Holdings LLC v. Brekka as precedent, the U.S. District Court for the Northern District of California disagreed with the government’s interpretation of the CFAA and dismissed five of the eight charges for failure to state an offense.  On appeal, an en banc panel of the U.S. Court of Appeals for the Ninth Circuit affirmed the District Court’s decision and found that the CFAA prohibits unauthorized access of computer information, not the misuse or misappropriation of that information. See United States v. Nosal, 676 F.3d 854 (9th Cir. 2012). The five dismissed charges were based on allegations that two individuals downloaded KFI information using their log-in credentials while they were employees. 

After the en banc decision, the remaining three CFAA charges were based on allegations that two former KFI employees used a log-in credential of a current KFI employee to run certain searches of the KFI database.  It was undisputed that these former employees had the current employee’s permission to use her log-in credentials, but they did not have permission from KFI.  In 2013, a jury convicted Mr. Nosal of three CFAA charges, two EEA charges, and one count of conspiracy to violate the CFAA and the EEA. 

Mr. Nosal timely filed an appeal, and the Ninth Circuit heard arguments last Tuesday, October 20th.  The CFAA appeal issue is whether obtaining information by using the current employee’s log-in credentials without the company’s permission constitutes a crime under the CFAA.  When deciding this issue, the Ninth Circuit must address whether the same meaning of “without authorization” should be applied to the misdemeanor provisions of the CFAA as it is applied to the felony provisions. 

Last Tuesday, Mr. Nosal’s lawyer argued that the meaning of “without authorization” must be read consistently throughout the CFAA, and sharing a password should not constitute a criminal act.  The government stated that it is not asking the court to adopt a bright line rule that sharing or using someone else’s password without authorization is a criminal act under the CFAA.  Rather, the government is urging the court to enforce its holding in the Brekka decision, in which the Ninth Circuit held that a person uses a computer “without authorization” under Section 1030(a)(2) and (4) of the CFAA when the employer rescinds permission to access the computer and the defendant uses the computer anyway.  It is worthing noting that during the government’s argument last Tuesday, Judge Reinhardt was quick to note that Brekka “doesn’t say that if you don’t use your authorization but somebody else gives you her authorization, you can’t use that.” 

According to the government, enforcing the Brekka rule in Nosal will not have ramifications outside of the employment context.  The court disagreed, stating that the limiting principle cannot be employment because the statute is not limited to the employment context.  The court seemed concerned about the broader issue raised in the defendant’s briefs and amicus briefs that affirming the District Court’s convictions and judgment would, in effect, criminalize password sharing.  Overall, the majority of the court’s questions to the government were fact-specific, possibly indicating that its holding will be narrow. 

Reporter, Jennifer Raghavan, San Francisco, +1 415 318 1234, jraghavan@kslaw.com.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© King & Spalding | Attorney Advertising

Written by:

King & Spalding

King & Spalding on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.