## Facts

- Comprehensive Technologies International, Inc. (CTI), a Virginia company, developed EDI-related software products, including “Claims Express” and “EDI Link.”
- Several CTI employees left CTI in February 1991 and, with another individual, formed Software Artisans, Inc. (SA) in April 1991.
- SA developed and marketed a competing EDI-based forms-transmission program called “Transend” by July 1991.
- CTI sued SA and former employees, alleging Transend infringed CTI’s copyrights, misappropriated CTI’s trade secrets under the Virginia Uniform Trade Secrets Act (VUTSA), and violated contractual duties.
- CTI also alleged that a former employee, Marshall Dean Hawkes, breached a termination agreement containing confidentiality obligations and a one-year covenant not to compete, not to solicit CTI’s customers, and not to hire CTI’s current or former employees.
- After a bench trial, the district court entered judgment for defendants on all claims.

## Issues

1. Whether Transend infringed CTI’s copyrights in Claims Express and EDI Link under the proper substantial-similarity analysis for computer software.
2. Whether CTI proved misappropriation of specific trade secrets under VUTSA.
3. Whether Hawkes’s one-year, nationwide restrictive covenant was unenforceable as unreasonable under Virginia law.
4. Whether the trial judge’s comments demonstrated reversible judicial bias.

## Decision

- The Fourth Circuit affirmed judgment for defendants on CTI’s copyright infringement and trade secret misappropriation claims.
- The Fourth Circuit held Hawkes’s noncompete covenant enforceable under Virginia law, vacated the judgment for Hawkes on the contract claim, and remanded to determine whether Hawkes breached the covenant.
- The Fourth Circuit rejected CTI’s judicial-bias argument.
- The panel opinion and judgment were later vacated and the case dismissed on rehearing.

## Legal Principles

- Software copyright substantial similarity requires comparing only protectable expression; similarities attributable to ideas, methods of operation, external constraints, public sources, or industry-standard conventions are excluded from the infringement analysis.
- Under VUTSA, a plaintiff must identify specific trade secrets and prove actual misappropriation; suspicion based on employee departures, rapid product development, or generalized similarity is insufficient without evidence of taking or use of concrete secrets.
- Under Virginia law, enforceability of a restrictive covenant depends on whether the restraint is no greater than necessary to protect legitimate business interests, not unduly harsh on the employee, and consistent with public policy; geographic breadth may be justified by a national market, and a one-year duration may be reasonable.

## Conclusion

The court upheld findings of no infringement and no trade secret misappropriation because CTI did not show similarity in protectable software expression or prove actual use of specific secrets, but it ruled that a one-year nationwide noncompete could be reasonable for a nationally scoped business and required further proceedings on whether the covenant was breached.


Comprehensive Techs. Int’l, Inc. v. Software Artisans, Inc., 3 F.3d 730 (4th Cir. 1993)