## Facts

- Videotronics, Inc., a Nevada manufacturer, sold video poker game machines incorporating a computer program stored on a silicon chip and related circuitry.
- Bend Electronics, an Oregon company, acted as Videotronics’ distributor and purchased substantial quantities of machines, later changing its name to Videotronics of Oregon, Inc. (VO).
- After a payment dispute and Videotronics’ refusal to ship additional units, Video Horizons, Inc. (VHI) was formed in Oregon; Videotronics alleged VHI functioned as a successor or substituted entity for VO.
- Videotronics alleged defendants created and marketed a competing video poker game by copying Videotronics’ program and misappropriating trade secrets, breaching a confidential relationship, and “palming off” an essentially identical product.
- Videotronics had not registered a copyright in the program at the time and did not plead a federal copyright claim, proceeding instead on state-law misappropriation/trade secret and unfair competition theories.
- Defendants (including VHI and individual Oregon defendants) moved to quash service and challenged personal jurisdiction; Videotronics moved for a preliminary injunction to stop manufacture/sales and alleged palming off.

## Issues

1. Whether the court could exercise personal jurisdiction over the Oregon corporate and individual defendants based on their contacts with Nevada.
2. Whether state-law misappropriation/unfair competition claims premised on copying a computer program and related expressive elements were barred by federal copyright law.
3. Whether Videotronics showed entitlement to a preliminary injunction given trade secret requirements, preemption concerns, and the equities.

## Decision

- The court denied the motion to quash service as to key Oregon defendants, finding sufficient Nevada contacts arising from the distribution relationship and related business activity.
- The court denied Videotronics’ motion for a preliminary injunction.
- The court concluded Videotronics failed to show a likelihood of success on asserted trade secret and misappropriation theories, including because the alleged secrets were not shown to be protected information and because the claims sought copyright-like protection for copyright subject matter.

## Legal Principles

- A state misappropriation or unfair competition theory cannot be used to secure protection equivalent to copyright for works within the subject matter of the Copyright Act when doing so would conflict with the federal scheme.
- Trade secret protection requires that the information be not generally known or readily ascertainable and that the claimant take reasonable measures to maintain secrecy.
- Commercially marketed products that can be duplicated through examination or reverse engineering, without meaningful secrecy safeguards or confidentiality obligations, generally do not qualify as trade secrets for injunctive relief.
- Preliminary injunctive relief requires a strong showing on the merits (including likelihood of success) and equitable considerations; weak merits showing defeats extraordinary relief.

## Conclusion

The court exercised personal jurisdiction over the Oregon defendants due to their distributor-related contacts with Nevada but refused to preliminarily enjoin a competing video poker game where the asserted state-law theories either failed to establish protectable trade secrets or impermissibly attempted to use state misappropriation and unfair competition law to obtain copyright-like control over software and related elements covered by federal copyright law.


Videotronics, Inc. v. Bend Elecs., 564 F. Supp. 1471 (D. Nev. 1983)