Illegal Database Case – Ipreo Holdings LLC v Goldman Sachs

In the case Ipreo Holdings LLC v Goldman Sachs, the plaintiff is justified to file the law suit because the defendant had a direct financial interest in accessing the data that would be used to contact potential customers and therefore, the company would profit from Ipreo’s software. Moreover, Goldman Sachs’ management agreed that their employees repeatedly downloaded confidential information and proprietary classified Intel; all of which was done illegally.  To bolster this argument Ipreo had licensed the software to over 16,000 clients who would back out if they feel their confidential information had been infringed (Vijayan). However, Goldman downplayed the allegation that specific employees were involved in the scheme; but rather they assured Ipreo LLC that the necessary legal procedures against the responsible culprits.

Goldman should be held vicariously liable for the illegal activities of its employees. According to case law on copyrights, companies are fully liable for electronic or copyright infringement by employees acting on behalf of the company, more so, if the infringement impacts the company’s business positively. In this case, Goldman Sachs could easily replicate the software and use it to expand in customer database. Copyright law grants rights to software owners and therefore, they have exclusive right to independently distribute the software (Dark Reading). The law aims at protecting companies such as Ipreo and in prosecuting Goldman for the damages and illegal activities of their employees. To begin with, Goldman Sacs may introduce a general rule that employees are liable for illegal actions conducted on behalf of the company. This law is applicable if the individual acted willfully and knowingly in infringing the property rights. Personality liability can be enforced by courts if evidence shows that they had material reason for infringing the rights. Secondly, the company may introduce compliance policy requirements that enable it to notify the management in case any of the employees involve themselves in an illegal act. Also, immediate response is essential when the copyright owner gives a notice that their software has been compromised (Bochoux 36). Lastly, continuous review of employee’s handbook, screening when hiring, periodic performance surveys and creation of detailed job descriptions are essential factors in protecting the company from repeated infringements.

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