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Intel Corp. v. Kourosh Kenneth Hamidi

By a 4-3 margin, the California Supreme Court holds that the transmission of six e-mails criticizing Intel's employment practices to approximately 35,000 Intel employees over Intel's Intranet, despite Intel's objection, does not constitute an actionable trespass to chattels because the transmission did not cause any injury to Intel's computer systems.  The transmission of these e-mails neither slowed nor otherwise disrupted the functioning of Intel's computer system.  As a result, the California Supreme Court rejected Intel's application for an injunction, enjoining defendant, a former Intel employee, from continuing to send e-mails to Intel employees.  In reaching this result, the Court held that neither the time Intel's employees spent reviewing these unwanted communications, nor the funds Intel expended in attempting to block their continued transmission, constituted the type of injury necessary to sustain a trespass to chattels claim.

This result constituted a reversal of prior decisions by both the California Superior Court and the California Court of Appeals, each of which had enjoined future transmissions by the defendant.  Three justices dissented in two extensive dissents.  Each of the dissenters would have continued the injunction issued by the lower courts on the grounds, inter alia, that a trespass to chattels claim does not require injury to the chattel in question -- rather, such a claim can be established solely by showing an unpermitted and objected to use of the chattel.

Kourosh Kenneth Hamidi ("Hamidi"), a former Intel employee, sent six e-mails over a 21 month period to approximately 35,000 Intel employees.  These e-mails were transmitted to Intel's employees via Intel's internal e-mail system, and over computers Intel purchased to enable this system to function.  The e-mails "criticized Intel's employment practices, warned employees of the dangers those practices posed to their careers, suggested employees consider moving to other companies, solicited employees' participation in FACE-Intel, and urged employees to … visit FACE-Intel's Web site."  FACE Intel was an organization formed to disseminate information critical of Intel's employment practice. 

The transmissions of these e-mails did not injure the computers which handled Intel's e-mail system, nor impair the functionality of this system.

Hamidi advised the recipients of his e-mails that he would not send them any further materials if they objected.  From the record, it appears Hamidi complied with this commitment.

During the course of these transmissions, Intel notified Hamidi that it objected to this use of its e-mail system and directed him to stop.  Hamidi refused, and instead continued to send e-mails to Intel's employees. 

The e-mails 'caused discussion' among Intel employees, many of whom asked Intel to stop their receipt of further communications.  As a result, Intel attempted via technological means to prevent Hamidi from continuing to be able to send his e-mails.  Hamidi was able, at least partially, to evade Intel's blocking efforts.  Intel expended funds in attempting to block Hamidi's e-mails.  It also lost the employee time spent reviewing and/or deleting these materials. 

In an effort to prevent Hamidi from continuing his activities, Intel commenced this suit claiming Hamidi's activities constituted a trespass to chattels.  Both the Superior Court and Court of Appeals agreed, and issued an injunction, permanently enjoining Hamidi "from sending unsolicited e-mail to addresses on Intel's computer systems." 

The tort of trespass to chattels provides a remedy for "the interference with possession of personal property."  To state such a claim under California law, "the defendant's interference must … have caused some injury to the chattel or to the plaintiff's rights in it."  As explained by the California Supreme Court:

[O]ne who intentionally intermeddles with another's chattel is subject to liability only if his intermeddling is harmful to the possessor's materially valuable interest in the physical condition, quality, or value of the chattel, or if the possessor is deprived of the use of the chattel for a substantial time …

Importantly, the Court spelled out the applicability of this doctrine to computer e mail systems.  Said the Court:

[U]nder California law the tort does not encompass, and should not be extended to encompass, an electronic communication that neither damages the recipient computer system nor impairs its functioning.  Such an electronic communication does not constitute an actionable trespass to personal property, i.e., the computer system, because it does not interfere with the possessor's use or possession of, or any other legally protected interest in, the personal property itself.

Applying these principles to the case at bar, the majority concluded that Intel had failed to establish a trespass to chattels claim because it had failed to show that its computer system sustained the requisite injury.  As explained by the Court:

The dispositive issue in this case, therefore, is whether the undisputed facts demonstrate Hamidi's actions caused or threatened to cause damages to Intel's computer system, or injury to its rights in that personal property, such as to entitle Intel to judgment as a matter of law.  To review, the undisputed evidence revealed no actual or threatened damage to Intel's computer hardware or software and no interference with its ordinary and intended operation.  Intel was not dispossessed of its computers, nor did Hamidi's messages prevent Intel from using its computers for any measurable length of time.  Intel presented no evidence its system was slowed or otherwise impaired by the burden of delivering Hamidi's electronic messages.  Nor was there any evidence transmission of the messages imposed any marginal cost on the operation of Intel's computers.  In sum, no evidence suggested that in sending messages through Intel's Internet connections and internal computer system Hamidi used the system in any manner in which it was not intended to function or impaired the system in any way.

The harms Intel did sustain -- the costs incurred in attempting to block Hamidi's continued transmission of his e-mails, and the lost employee time spent reviewing and/or deleting these e-mails -- were not sufficient to sustain a trespass claim because they did not constitute injury to the chattel in question.  Said the Court:

The consequential economic damage Intel claims to have suffered, i.e., loss of productivity caused by employees reading and reacting to Hamidi's messages and company efforts to block the messages, is not an injury to the company's interest in its computers-which worked as intended and were unharmed by the communications any more than the personal distress caused by reading an unpleasant letter would be an injury to the recipient's mailbox, or the loss of privacy caused by an intrusive telephone call would be an injury to the recipient's telephone equipment.

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Whatever interest Intel may have in preventing its employees from receiving disruptive communications, it is not an interest in personal property, and trespass to chattels is therefore not an action that will lie to protect it.  Nor, finally, can the fact Intel staff spent time attempting to block Hamidi's messages be bootstrapped into an injury to Intel's possessory interest in its computers.  To quote, again, from the dissenting opinion in the Court of Appeal: "[I]t is circular to premise the damage element of a tort solely upon the steps taken to prevent the damage.  Injury can only be established by the completed tort's consequences, not by the cost of the steps taken to avoid the injury and prevent the tort; otherwise, we can create injury for every supposed tort."

Because Intel failed to establish its trespass claim, the Court held it was not entitled to injunctive relief.  Importantly, the Court reached this result notwithstanding its recognition that Hamidi did not have a right to use Intel's Intranet in a manner contrary to its wishes.  "While one may have no right temporarily to use another's personal property, such use is actionable as a trespass only if it 'has proximately caused injury.'  '[I]n the absence of any actual damage the action will not lie.'"

In reaching this result, the Court rejected the views of two courts which held that evidence of injury to the chattel itself was not a prerequisite to a trespass to chattel claim.  The first, Oyster Software Inc. v. Forms Processing Inc., 2001 WL 1736382 (N.D. Cal. Dec. 6, 2001) was criticized for "incorrectly read[ing] eBay as establishing, under California law, that mere unauthorized use of another's computer system constitutes an actionable trespass."

And to the extent the second decision, eBay Inc. v. Bidder's Edge, 100 F.Supp.2d 1058 (N.D. Cal. 2000) held that a trespass to chattel claim could proceed based solely on the unauthorized use of a chattel, without any evidence of its injury, this decision "would not be a correct statement of California or general American law on this point."

Finally, the California Supreme Court declined Intel's invitation to modify existing California law to grant it a viable cause of action.

The majority's decision was accompanied by two extensive dissenting opinions, authored by Justices Brown and Mosk, which collectively garnered the support of three of the seven judges who decided this appeal.  Each dissenter would have affirmed the award of injunctive relief granted by the courts below.

According to Justice Brown, the injunctive relief issued by the lower courts was in accord with those cases that allow an individual to avoid unwanted communications, be they junk mail sent to his home, unwanted door-to-door salesmen, or unsolicited 'junk' faxes.  Accordingly, Justice Brown would hold that Hamidi's transmission of e-mail to Intel employees can be enjoined once Intel objects to further communications.

Justice Brown would also hold that a claim of trespass to chattels can be sustained without any injury to the chattel in question.  It is enough that the defendant used the property of another without permission, a position Justice Brown opines finds support in prior Court decisions such as e-Bay.  Finally, Justice Brown would hold that the injuries sustained by Intel -- the cost of blocking and the time expended by employees during their review of the unwanted e mails -- were sufficient to sustain a trespass to chattels claim.

Justice Mosk, in a dissenting opinion joined by Chief Justice George, would also hold, like Justice Brown, that Hamidi's unauthorized use of Intel's e-mail system over Intel's objection was sufficient to constitute a trespass to chattels, even in the absence of any injury to the chattel itself.  Justice Mosk would further hold that, to the extent injury is a required element of a trespass claim, the injuries Intel claimed to have sustained would be sufficient to sustain the claim.