Broker Genius, Inc. v. Volpone (313 F. Supp. 3d 484, 2018)

SIDNEY H. STEIN, U.S. District Judge

Broker Genius is a technology company serving ticket brokers on the secondary ticket market. Its product, AutoPricer v.3 ("AutoPricer"), is a web application that enables secondary-market ticket brokers to dynamically and automatically price their inventory of tickets. Through contractual Terms of Use, Broker Genius customers are granted a conditional license to use the AutoPricer application. Defendant Drew Gainor, a former Broker Genius customer, is the cofounder of defendant Seat Scouts LLC ("Seat Scouts"), whose Command Center product competes with AutoPricer. Broker Genius has sued Gainor, Seat Scouts, and others, alleging that Gainor improperly and in violation of the Terms of Use used the knowledge and information he gained while he was a Broker Genius customer to develop Command Center.

Broker Genius now moves pursuant to Federal Rule of Civil Procedure 65 to preliminarily enjoin defendants from using and selling Command Center. Broker Genius grounds its motion in its claims for breach of contract and unjust enrichment.

For the reasons set forth below, the Court finds that the Terms of Use, which Gainor entered into, prohibited him from creating a product that was derived from AutoPricer, and that Broker Genius is likely to prevail on its claim that Gainor breached that contract when he developed Command Center by deriving it from AutoPricer. The Court also finds that Broker Genius will suffer irreparable harm if an injunction does not issue. Accordingly, Broker Genius's motion for a preliminary injunction is granted.

I. PROCEDURAL HISTORY

A. Related Cases

Prior to instituting this action, Broker Genius brought two other actions making substantially identical claims against two other companies: NRZ Entertainment LLC and Select Seats LLC.

In the first action (the "NRZ" action), Broker Genius sought a preliminary injunction based on its trade secrets claim alone. See Broker Genius, Inc. v. Zalta et al. , 280 F.Supp.3d 495, 510, 511 n.6 (S.D.N.Y. 2017). A TRO issued on March 23, 2017, and a preliminary injunction hearing was held over the course of three days in June, resulting in a denial of the preliminary injunction and a finding that Broker Genius had not sufficiently maintained the confidentiality of its secrets so as to enable it to benefit from trade secret protection. Id. at 498. At the same time, the Court noted that the facts of that case very strongly suggested that the defendants there had breached the contractual user agreements. Id. at 510-13. Shortly after that Opinion issued, the parties in the NRZ action resolved all of the claims. See Stipulation of Dismissal with Prejudice, Broker Genius, Inc. v. Zalta et al., No. 17-Cv-2099, Jan. 10, 2018, ECF No. 172.

In the second action, a TRO issued against Select Seats LLC on November 8, 2017. Order to Show Cause for Prelim. Inj. and TRO, Broker Genius, Inc. v. Berry et al., No. 17-Cv-8511, Nov. 8, 2017, ECF No. 10. The parties stipulated to dismiss that action shortly thereafter. Stipulation of Dismissal with Prejudice, Broker Genius, Inc. v. Berry et al., No. 17-Cv-8511, Nov. 22, 2017, ECF No. 25.

B. This Action

This action was initiated against Drew Gainor and Seat Scouts LLC on November 7, 2017. Gainor is the cofounder of Seat Scouts LLC, a Nebraska limited liability company that came into existence in March of 2017, shortly after Gainor stopped using Broker Genius's product. (Second Amended Complaint ("SAC") ¶¶ 12, 43, ECF No. 108.) Gainor maintains an ownership interest in Seat Scouts through a chain of entities. (SAC ¶¶ 8, 12.) Through two amended complaints, Broker Genius added six defendants. (See SAC; First Amended Complaint, ECF No. 43.)

The current complaint asserts the following claims: (1) breach of contract (as to defendants Gainor, Guinio Volpone, and Event Ticket Sales LLC); (2) unfair competition; (3) conversion; (4) tortious interference with business relationships; (5) unjust enrichment; and (6) breach of the implied duty of good faith and fair dealing (as to defendants Gainor, Volpone, and Event Ticket Sales). (SAC ¶¶ 55-100.)

After hearing argument from all parties, the Court issued a TRO on November 9, 2017. (Order to Show Cause for Prelim. Inj. and TRO ("Order to Show Cause"), Nov. 9, 2017, ECF No. 8.) The TRO did not enjoin defendants from marketing or selling their product, but it did enjoin them from violating the contractual Terms of Use. (Id. at 2-3.)

Broker Genius now moves for a preliminary injunction; that motion is expressly based on its breach of contract and unjust enrichment claims. (See generally Pre-Hr'g Mem. in Supp. of Pl.'s Mot. for Prelim. Inj. ("Pl.'s Pre-Hr'g Mem."), ECF No. 72; Post-Hr'g Mem. in Supp. of Pl.'s Mot. for Prelim. Inj. ("Pl.'s Post-Hr'g Mem."), ECF No. 90.) A fact hearing on this motion was held over the course of five days in December 2017 and January 2018, during which the parties proffered witnesses and documentary evidence. The Court's findings of fact and conclusions of law are as follows.

II. BACKGROUND

A. Broker Genius's Lengthy and Expensive Development of AutoPricer

The Court summarized Broker Genius's history and development of AutoPricer in its opinion in the NRZ action:

Broker Genius, Inc., is a software company that specializes in developing software products and services to help automate the pricing of tickets in secondary markets. The secondary market for tickets for sporting events, concerts, and theater performances is a multi-billion dollar industry in which ticket brokers purchase tickets from ticket sellers (e.g., Ticketmaster) in the primary market and then resell to consumers through online exchanges (e.g., StubHub).

Broker Genius was founded in 2013 by Shmuel ("Sam") Sherman, who had previously worked as a ticket broker on the secondary market and currently serves as the company's CEO. Sherman testified that he started Broker Genius in order to build a software product that would allow brokers to "implement the strategies" they had already been using to price tickets manually, but "within a user interface in which the user could engage ... with the software dynamically and have the ability to change [his or her] strategy very quickly." Sherman recognized that brokers did not only need an automatic pricing solution, but that they also needed a user interface that would enable them to efficiently "analyze the market" in order to define and price their inventory against comparable listings. At the time of Broker Genius's founding in 2013, no other software offered these capabilities.

Sherman and plaintiff's expert, Dr. Eric Koskinen, testified that because Broker Genius was creating a type of product that did not already exist in the marketplace, it spent considerable time creating its own roadmap for the functions the software should perform and refining its user interface through trial and error and responses to customer feedback. Accordingly, Broker Genius created multiple iterations of its product over the course of two years; it released the first version in September 2013 and did not launch the version at issue in this case-AutoPricer v. 3-until July 2015. This development process necessitated an investment of over $4 million.

Zalta , 280 F.Supp.3d at 499 (citations omitted).

Broker Genius generates its revenue based on the volume of sales its users price through AutoPricer. (Ellman Test., Prelim. Inj. Hr'g Tr. ("Tr.") 66-67, ECF Nos. 93-102; Sherman Test., Tr. 305-06; Email from Gainor to Ellman at 5, May 27, 2016, PX-97.) As of the preliminary injunction hearing, Broker Genius had approximately 170 clients. (Sherman Aff. ¶ 20, ECF No. 72, Ex. 1.)

B. The Contract at Issue: The Terms of Use

Broker Genius requires that each of its users assent to its contractual terms of use when the user creates an account. Two versions of the terms of use are at issue in this case-the first is the version that was effective in May of 2016 (the "Original Terms of Use," PX-3), and the second is the version that became final on June 6, 2016 (the "Updated Terms of Use," PX-15). According to Broker Genius, new users were not able to register as customers and obtain access to AutoPricer unless they ticked a checkbox assenting to the Original Terms of Use on the Broker Genius website during the registration process. (Sherman Aff. ¶¶ 13, 15.) Existing Broker Genius customers were subsequently asked to assent to the Updated Terms of Use beginning on July 7, 2016. (Sherman Test., Tr. 289.) After that date, users were confronted with a pop-up dialog box each time they would log in to the site, which required them to assent to the Updated Terms of Use in order to use AutoPricer. (Ellman Test., Tr. 63-64; Sherman Test., Tr. 290.)

The Original Terms of Use and the Updated Terms of Use are identical in all respects relevant to this litigation. Accordingly, this Opinion refers simply to the "Terms of Use" except where the distinction is relevant. The Terms of Use contain a section titled "Ownership of Data, Content and Grant of Conditional License," which provides in relevant part as follows:

We [i.e., Broker Genius] grant you a limited, conditional, no-cost, non-exclusive, non-transferable, non-sub-licensable license to view or use this Site or Apps and its Content as permitted by these Terms, as a condition precedent, you agree that you will not:

...

Reproduce, modify, display, publicly perform, distribute or create derivative works of the Site or Apps or the Content;

....

(Terms of Use at 3-4.)

The contractual provision at issue in this case is the explicit prohibition against "distribut[ing] or creat[ing] derivative works of" AutoPricer.

C. Gainor's Prior Knowledge and Experience in the Industry

Defendant Drew Gainor testified that he had eighteen years of experience in the ticket industry, beginning in college when he started a business called Source4tickets.com. Source4tickets had five or six employees and various websites that sold tickets. (Gainor Test., Tr. 383.) Gainor continued building Source4tickets after he graduated in 2003, and also began developing a product called Concierge Live, a platform that, according to Gainor, is "currently used by Fortune 500 companies to manage their tickets." (Gainor Test., Tr. 384.)

Around August 2006, Source4tickets merged into National Event Company, where Gainor continued to oversee the development of Concierge Live, and also built the first website for Ultimatefan.com, a website that sold "fan experiences and travel," according to Gainor. (Gainor Test., Tr. 385-86.)

Gainor testified that he left National Event Company and started Ticket Evolution around 2010 to develop products "on behalf of the ticket industry." (Gainor Test., Tr. 386-87.) At Ticket Evolution, Gainor "had [his] hand in everything," and worked on two specific Ticket Evolution products: Core, and an "auto-uploader." (Gainor Test., Tr. 387-88, 390-97, 429-30.)

Around March of 2015, Gainor left Ticket Evolution and, after "decompressing," took a job with defendant Event Ticket Sales, a ticket brokerage company, to help expand its ticket inventory. (Gainor Test., Tr. 428-29.) As of the date of the preliminary injunction hearing, Gainor was still employed by defendant Event Ticket Sales. (Gainor Test., Tr. 429.)

D. Gainor's Relationship with Broker Genius

On May 23, 2016, Gainor contacted Sherman via LinkedIn, seeking information about becoming a Broker Genius customer. (LinkedIn Conversation Between Gainor and Sherman, May 23, 2016, PX-125; Gainor Test., Tr. 465.) At that time Gainor was working as a ticket broker with Event Ticket Sales. (Gainor Test., Tr. 428-29.)

Sherman replied to Gainor's LinkedIn message immediately, and they agreed that Zak Ellman, Broker Genius's Vice President of Sales, would follow up with Gainor. (LinkedIn Conversation Between Gainor and Sherman.) Gainor subsequently signed up for a free 30-day trial with Broker Genius on May 26, 2016, during a phone call with Alex Berrick, then Broker Genius's Customer Success Coordinator. (Email from Gainor to Ellman at 3, PX-97; Berrick Test., Tr. 138.)

Broker Genius alleges-but defendants dispute-that Gainor assented to the Terms of Use when he registered on May 26, 2016. Although all users were required to accept the Terms of Use in order to register, Gainor alleges that his registration was in fact completed by Broker Genius's Berrick during their phone call-that is, that Gainor provided Berrick with his registration information (e.g. name, email, password) over the telephone, and Berrick completed the registration process on Gainor's behalf, including assenting to the Terms of Use. (Gainor Test., Tr. 467.) Although no Broker Genius witness could specifically recall how Gainor registered, their consistent testimony was that Gainor's explanation was inconsistent with important company policy and training. However, a time stamp that recorded Gainor's purported assent and a simultaneous auto-generated email failed to rebut Gainor's explanation, as Sherman admitted that these would have been the same even if it were Berrick who actually entered Gainor's email address and ticked the box assenting to the Terms of Use. (Sherman Test., Tr. 344.) The Court need not, and does not, decide whether Gainor accepted the Terms of Use in May of 2016, because it finds that, in any event, he did accept them two months later. (See infra , § V.A.)

Gainor began using AutoPricer shortly after he registered, and he continued using it to price tickets until at least the end of 2016. (Sherman Test., Tr. 304-05, 359-60; Gainor Test., Tr. 453, 455.) At a minimum, Gainor used AutoPricer during those seven months to price his inventory of Minnesota Vikings tickets. (Gainor Test., Tr. 425.)

During this period, Broker Genius asked its customers to assent to the Updated Terms of Use. (Sherman Test., Tr. 289.) Broker Genius alleges-and defendants again dispute-that Gainor assented to the Updated Terms of Use on July 7, 2016. (Ellman Test., Tr. 65.) At the hearing, defendants did not offer any proof in support of their position, and in fact Gainor was able to continue using AutoPricer after the July 7 update. (Gainor Test., Tr. 424-25, 453.)

Gainor made no further use of AutoPricer in 2017, (Sherman Test., Tr. 304-05; Gainor Test., Tr. 455), although he was still able log in to and view his account until April 27, 2017, when it was disabled, (Sherman Test., Tr. 304-05, 359-60).

E. Defendants' Development of Command Center

Gainor concedes that the idea to develop an autopricer came to him as a direct result of his experience as a Broker Genius customer who used the AutoPricer product. (Gainor Test., Tr. 436.) According to Gainor, this idea came to him in early January 2017, and he began to lay out a "first draft" of his ideas for an autopricer in a digital notepad. (Gainor Test., Tr. 435; see Gainor Evernote titled "Auto-Pricer," Jan. 8, 2017, PX-18.) On January 8, 2017, while he still had the license to use Broker Genius's AutoPricer, he emailed his business partner, defendant Guinio Volpone, that he "want[ed] to build [an autopricer] more than ever! After this weekend, I think we can build the best pricing view/Auto pricer in the industry!" (Email from Gainor to Volpone, Jan. 8, 2017, PX-11.) The next week, Gainor was sketching mockups and creating coding tasks in a project management tool. (Gainor wireframes, Jan. 15, 2017, PX-19; Gainor Pivotal Tracker entries, Jan. 14-15, 2017, PX-145.)

At some point in 2016, talks had developed between Gainor and a company called Seat Metrics about a potential partnership to develop a separate autopricing product that Seat Metrics was already developing (Gainor Test., Tr. 486:24-25), and which Gainor had been beta testing since September of that year (Email from Panzer to Gainor, Sept. 18, 2016, PX-9). On February 10, 2017, Gainor turned down the proposed partnership, explaining that he was "working on a suite ... that is way more than an autopricer." (Email from Gainor to Volpone, Feb. 10, 2017, PX-10.)

By late February of 2017, Gainor was talking about hiring an engineer to begin writing code for an autopricer product (Email from Sosinski to Gainor, Feb. 27, 2017, PX-51), and in March, Gainor and Volpone incorporated Seat Scouts LLC (Gainor Test., Tr. 487), presumably as the vehicle to market and profit from Command Center. According to Gainor, coding began on May 31 or June 1, 2017 (Gainor Test., Tr. 422, 543), and they had an initial version of Command Center up and running within a few weeks (Gainor Test., Tr. 434).

Approximately one month later, Seat Scouts posted information about its forthcoming autopricer product on its website, and announced it in a marketing email blast. (Email from Panzer to Gainor, July 13, 2017, PX-12; Email from Brett to Sherman, July 13, 2017, PX-89; Gainor Test., Tr. 423.) From September to the middle of October, the product was in beta testing (Gainor Test., Tr. 423, 443, 551), and Command Center was officially launched during a webinar on November 1, 2017, (Gainor Test., Tr. 551-52).

F. Similarities and Differences Between Plaintiff's AutoPricer and Defendants' Command Center

Broker Genius and defendants both retained well-credentialed experts to review AutoPricer and Command Center and render an opinion at the preliminary injunction hearing as to whether defendants derived their product from AutoPricer. In his written report, Broker Genius's expert, Dr. Eric Koskinen, concluded that "it is highly likely that software architectures/components within Command Center were derived from software architectures/components within AutoPricer v3." (Expert Report of Prof. Eric Koskinen ("Koskinen Report") 5, Dec. 13, 2017, PX-16.) Unsurprisingly, defendants' expert, Marina Martin, came to the opposite conclusion in her written report: "Command Center ... did not originate, in whole or in part, from AutoPricer v3, and in fact many of the alleged derivations are the result of common industry knowledge and/or common technology best practices and patterns." (Report of Marina Martin ("Martin Report") 4, Dec. 15, 2017, DX-Q.)

Dr. Koskinen found that AutoPricer and Command Center are markedly similar in numerous respects, and grouped the similarities into two categories. First, he found that both have an overall architecture and a User Interface/User Experience ("UI/UX") that are optimized for secondary-market ticket brokers to price their tickets dynamically and automatically through the creation of pricing rules. (Koskinen Report 12; see also id. at 7 ("These systems are dynamic in that they react to changing market conditions and they are automatic in that they can change ticket prices without requiring the user to continually specify the new price.").) The overall architecture that is common to both products consists of a web-based application that acts as an intermediary between point-of-sale ticket inventory systems ("POS" systems) and ticket exchange systems, applying dynamic automatic pricing rules.

The UI/UX that is common to both products consists of a "cascading flow of widgets" that enables users to create, monitor, and update the dynamic automatic pricing rules. (Koskinen Report 12.) At the preliminary injunction hearing, the Court observed Dr. Koskinen's demonstration of the "cascade" that a user proceeds through when creating the user's individualized pricing rules in AutoPricer and Command Center. In both products, the user begins by selecting from a list of ticketed events. That allows the user to view her or his current inventory of tickets to that event, and select the ticket for which the user will create a pricing rule. The user can also select a group of tickets or a season ticket so as to create a rule that will apply to multiple tickets at once. Next, the user navigates to a particular zone, section, and row within the event venue to select one or more reference tickets-called "comparables," or, more colloquially, "comps"-to compete against. The pricing rule will refer to the comps in setting the price of the user's ticket. Finally, the user sets the criteria by which the pricing rule will dynamically and automatically set the ticket price, based on the designated comps and other criteria such as "splits." (See Koskinen Test., Tr. 174-212; Koskinen Report, Exs. C & D; Martin Report 16-23.)

In the second category of similarities, Dr. Koskinen found that the individual widgets within the cascade are similar. More specifically, he found that both products consist of essentially the same collection of six components-the "widgets"-and that the components interrelate with each other and with external systems in essentially the same way, and also have internal characteristics that are substantially similar. (Koskinen Report 14.) As defined by Dr. Koskinen, these components are: (1) Events List Widget, (2) Inventory List Widget, (3) Zones/Sections/Rows Widget, (4) Price By Comps Widget, (5) Seasons Widget, and (6) Groups Widget. (Koskinen Report 14-23.) In both products, the Events List Widget displays the name, date and time, venue, and number of tickets in the user's inventory, and also permits the user to search the list using terms and filters; Command Center has additional information such as event tags, number of rules, and cost. The other widgets have essentially comparable similarities and differences across the two products.

Together, these widgets interoperate "to combine data from multiple sources ... to allow users to create rules for dynamic automatic pricing" through an effective UI/UX. (Koskinen Report 14-15.) In his report, Dr. Koskinen identified specific similarities in each widget's internal and inter-widget behavior.

Dr. Koskinen identified one additional similarity apart from the two categories: both products employ a particular means of addressing the "scalability" issue-that is, how to add more and more users and inventory without compromising the functionality of the product. Scalability is of particular importance where, as here, the applications depend on their ability to communicate pricing updates to and from external systems, and such systems impose limits on the frequency with which external applications (such as AutoPricer and Command Center) can communicate with them. Furthermore, secondary ticket market brokers who cannot update their prices frequently enough to keep up with the market are at a competitive disadvantage. (Koskinen Report 13.)

Here, both products address scalability the same way: They prioritize updates based on how soon the ticketed event will take place-that is, prices for a ticket to an event next week will update more frequently than prices for a ticket to an event next month. Both products have essential elements in common, including that they sort their tickets into exactly four tiers depending upon how far away in days the event is, and those four tiers are set at comparable, albeit not identical, intervals. (Koskinen Report 13.)

Ms. Martin found that the similarities identified by Dr. Koskinen are either innocent or immaterial-as discussed more fully below. Primarily, defendants assert that the similarities are obvious, that they were known in the industry prior to or independent of Broker Genius's AutoPricer, or that they are attributable to Gainor's own industry experience.

In addition, Ms. Martin focuses on differences between the products, two of which merit discussion here. First, upon logging in to AutoPricer, a user views all of the widgets on a single screen. As the user continues to use AutoPricer, the widgets remain viewable in one place as the user navigates between the different widgets. By contrast, a user who logs in to Command Center views only the Events List Widget. As the user continues to use Command Center, each widget opens in a new screen that occupies the entire browser window, such that only one widget is viewable at a time. (Martin Report 9-12; Martin Test., Tr. 576.)

Second, AutoPricer has separate Zones/Sections/Rows and Price By Comps Widgets, whereas Command Center integrates them into a single widget. (Martin Report 40.)

G. Defendants' Marketing and Sales of Command Center and its Impact on Broker Genius

Defendants market Command Center to an audience that includes the existing clients of Broker Genius. (See, e.g. , Email from Brett to Sherman, PX-89.) Broker Genius alleges that as a result, it has suffered five types of losses, all of which are attributable to the fact that in their view-and, allegedly, their customers'-Seat Scouts "offer[s] an identical product to [AutoPricer] at a fraction of the cost." (Ellman Test., Tr. 67.) User rates for Command Center are about a quarter of what they are for AutoPricer. (Sherman Test., Tr. 301; Sherman Aff. ¶ 26.)

First, Broker Genius alleges that, as of the date of the preliminary injunction hearing, five to ten clients had left Broker Genius in favor of Seat Scouts. (Ellman Test., Tr. 68; Sherman Test., Tr. 305; Sherman Aff. ¶ 24.) Second, at least eight clients have shifted a portion of their inventory from AutoPricer to Command Center, reducing the total inventory they price with AutoPricer (Ellman Test., Tr. 67; Sherman Test., Tr. 305), thereby reducing Broker Genius's revenue, which is based on inventory volume. Third, Broker Genius has had to renegotiate its pricing agreements with an unspecified number of clients in order to entice them to continue using AutoPricer and not Command Center. (Ellman Test., Tr. 66, 72; BG-SS 4602-4604 ("Damages Chart") at 1, PX-87.) Fourth, ten to fifteen prospective clients have opted against signing up with Broker Genius in favor of Seat Scouts, and other existing clients have opted not to deepen their engagement with Broker Genius. (Ellman Test., Tr. 66, 68, 73; Sherman Test., Tr. 305; Damages Chart at 2, PX-87; Sherman Aff. ¶ 24.) Fifth, Broker Genius's reputation and goodwill have suffered because of a resulting perception that Broker Genius "rip[s] [its customers] off" due to its higher prices, when in fact the reason that defendants are able to charge such low rates for Command Center is that they avoided significant development costs by improperly copying Broker Genius's product. (Sherman Test., Tr. 301-02; Sherman Aff. ¶¶ 25-27.)

According to Broker Genius, its losses continue to mount as defendants continue to market and license their product. (Sherman Test., Tr. 301.) According to Broker Genius, if the preliminary injunction enjoining defendants from marketing and selling Command Center is not granted, additional clients will enter the market with inexpensive copycat products improperly derived from AutoPricer, and that Broker Genius will be "out of business within a period of months." (Sherman Test., Tr. 306; Sherman Aff. ¶ 22.)

III. STANDARD FOR A PRELIMINARY INJUNCTION

A preliminary injunction is "one of the most drastic tools in the arsenal of judicial remedies" and courts have cautioned that it should be "used with great care." Hanson Tr. PLC v. SCM Corp. , 774 F.2d 47, 60 (2d Cir. 1985). Injunctions "should not be granted unless the movant, by a clear showing, carries the burden of persuasion." Moore v. Consol. Edison Co. of N.Y., Inc. et al. , 409 F.3d 506, 510 (2d Cir. 2005) (quoting Mazurek v. Armstrong , 520 U.S. 968, 972, 117 S.Ct. 1865, 138 L.Ed.2d 162 (1997) ).

In the Second Circuit, "[a] party seeking a preliminary injunction must demonstrate: (1) 'a likelihood of success on the merits or sufficiently serious questions going to the merits to make them a fair ground for litigation and a balance of hardships tipping decidedly in the plaintiff's favor'; (2) a likelihood of 'irreparable injury in the absence of an injunction'; (3) that 'the balance of hardships tips in the plaintiff's favor'; and (4) that the 'public interest would not be disserved' by the issuance of an injunction."

Benihana, Inc. v. Benihana of Tokyo, LLC , 784 F.3d 887, 895 (2d Cir. 2015) (alteration omitted) (quoting Salinger v. Colting , 607 F.3d 68, 79-80 (2d Cir. 2010) ); see also Am. Civil Liberties Union v. Clapper et al. , 785 F.3d 787, 825 (2d Cir. 2015) ; Citigroup Glob. Mkts., Inc. v. VCG Special Opportunities Master Fund Ltd. , 598 F.3d 30, 35 (2d Cir. 2010).

IV. IRREPARABLE HARM

"[I]rreparable harm exists only where there is a threatened imminent loss that will be very difficult to quantify at trial." Tom Doherty Assocs., Inc. v. Saban Entm't, Inc. et al. , 60 F.3d 27, 38 (2d Cir. 1995). Where an injury "can be compensated by an award of monetary damages, then an adequate remedy at law exists and no irreparable injury may be found as a matter of law." Register.com, Inc. v. Verio, Inc. , 356 F.3d 393, 426 (2d Cir. 2004) (quotation marks omitted).

Broker Genius seeks a preliminary injunction based on its breach of contract claim and its unjust enrichment claim. For the reasons that follow, the Court finds that Broker Genius has shown irreparable harm with respect to its breach of contract claim, but that it cannot show irreparable harm with respect to its unjust enrichment claim as a matter of law.

A. Breach of Contract

Although "specific relief is not the conventional remedy for breach of contract," it is well accepted that certain breach of contract claims present a threat of imminent loss that cannot be compensated at trial, and so "there is certainly no ironclad rule against its use." Register.com , 356 F.3d at 404.

In particular, "irreparable harm through loss of reputation, good will, ... business opportunities," or loss of customer relationships can justify injunctive relief on a breach of contract claim. Register.com , 356 F.3d at 404 ; O.D.F. Optronics Ltd. et al. v. Remington Arms Co. et al. , No. 08-Cv-4746, 2008 WL 4410130, at *8 (S.D.N.Y. Sept. 26, 2008) ; see also Tom Doherty Assocs. , 60 F.3d at 38 ("hold[ing] that a loss of prospective goodwill can constitute irreparable harm" justifying injunctive relief based on a breach of contract); Muze, Inc. v. Digital On-Demand, Inc. , 123 F.Supp.2d 118, 130 (S.D.N.Y. 2000) (finding that a "breach of contract ... in a manner that is directly competitive with [plaintiff's] core ... business ... threatens imminent injury to the economic value of the goodwill and reputation associated with [plaintiff's] product," justifying injunctive relief); Norcom Elecs. Corp. v. CIM USA Inc. et al. , 104 F.Supp.2d 198, 209 (S.D.N.Y. 2000) (finding evidence of irreparable harm and granting preliminary injunction on breach of contract claim).

Broker Genius has credibly demonstrated that if an injunction does not issue, it will continue to incur loss of reputation, good will, business opportunities, and customer relationships. Specifically, Broker Genius affirms that existing customers and inventory have transferred their business to Seat Scouts, resulting in revenue losses; potential customers are choosing Seat Scouts over Broker Genius, resulting in lost opportunities for revenue growth; and a perception is developing in the industry that Broker Genius "rips off" its customers, resulting in losses to its reputation and good will. (See Ellman Test., Tr. 66, 68, 72-73; Sherman Test., Tr. 301-02, 305-06; Sherman Aff. ¶¶ 22, 24-27; Damages Chart at 1-2; see generally § II.G, supra .) None of this is surprising given that the parties agree that AutoPricer and Command Center are competitive products and the latter is available to customers at much lower prices than the former.

Defendants argue that a substantial infusion of investor capital into Broker Genius belies its claim that Command Center poses an existential threat. (Defs.' Post-Prelim. Inj. Hr'g Mem. ("Defs.' Post-Hr'g Mem.") 21, ECF No. 89.) However, the Court need not find that a threat is existential where there is credible evidence of loss to reputation, good will, business opportunities, and customer relationships, which cannot be compensated by money damages. Moreover, defendants' argument is necessarily shortsighted-a single cash infusion would at most forestall the inevitable if Broker Genius is losing its primary source of revenue to a low-cost copycat product.

Defendants also argue that Broker Genius failed to connect its alleged losses to the existence of any specific Command Center feature that was derived from AutoPricer. Because the Court finds that the Command Center product is derivative as a unit-not limited to particular features or components (see infra )-this argument is unavailing.

The Court therefore concludes that Broker Genius has shown that, with respect to the breach of contract claim, it will be irreparably harmed if defendants are not enjoined from marketing and selling Command Center.

B. Unjust Enrichment

Unjust enrichment is an equitable claim for money. An unjust enrichment claim "can serve as the basis for a preliminary injunction freezing assets ," under circumstances where "the defendant took steps to frustrate a future judgment or that the defendant is or imminently will be insolvent." Shaoxing Bon Textiles Co. v. 4-U Performance Grp. LLC et al. , No. 16-Cv-6805, 2017 WL 737315, at *2-3 (S.D.N.Y. Feb. 6, 2017) (emphasis added) (quoting Sterling Ornaments Pvt. Ltd. v. Hazel Jewelry Corp. et al. , No. 14-cv-8822, 2015 WL 3650182, at *1 (S.D.N.Y. June 10, 2015) ); see also Shamrock Power Sales, LLC v. Scherer et al. , No. 12-Cv-8959, 2016 WL 6102370, at *5 (S.D.N.Y. Oct. 18, 2016).

Broker Genius does not seek an injunction freezing defendants' assets, and there are no allegations with respect to defendants' financial stability or lack thereof. Therefore, its request for a preliminary injunction cannot succeed on the basis of that claim.

V. LIKELIHOOD OF SUCCESS ON THE MERITS

To establish a likelihood of success on the merits, a plaintiff "need not show that success is an absolute certainty. He need only make a showing that the probability of his prevailing is better than fifty percent." Eng v. Smith , 849 F.2d 80, 82 (2d Cir. 1988) (quoting Abdul Wali et al. v. Coughlin et al. , 754 F.2d 1015, 1025 (2d Cir. 1985), overruling on other grounds recognized by, United States v. Thorn , 317 F.3d 107, 117 (2d Cir. 2003) ).

The Court finds that Broker Genius is likely to succeed on its breach of contract claim. Specifically, the Court finds that it is highly likely that Broker Genius can show that Gainor assented to the Updated Terms of Use and that defendants breached the Updated Terms of Use by creating and distributing a derivative work of AutoPricer, viz , Command Center.

A. Gainor Assented to the Contract

The contracts at issue in this case are the Original Terms of Use and the Updated Terms of Use, which are identical in all respects relevant to this litigation. Both Terms of Use agreements were contained within a clickwrap agreement on the Broker Genius website that required users to expressly assent and made the contents of the agreement viewable by following a hyperlink. As such, the agreements are enforceable so long as they provided "reasonably conspicuous notice of the existence of contract terms" and required an "unambiguous manifestation of assent to those terms." Meyer v. Uber Techs., Inc. et al. , 868 F.3d 66, 74 (2d Cir. 2017) (alterations omitted) (quoting Specht et al. v. Netscape Commc'ns Corp. et al. , 306 F.3d 17, 35 (2d Cir. 2002) ); see Broker Genius, Inc. v. Zalta et al. , 280 F.Supp.3d 495, 521 (S.D.N.Y. 2017).

Evidence that a user continued to access a website when the user would not have been able to but for manifesting assent to the provisions of a clickwrap agreement, together with record evidence of the user's assent, is sufficient to demonstrate unambiguous manifestation of assent-even if the party has no recollection of clicking. See Eslworldwide.com, Inc. v. Interland, Inc. et al. , No. 06-Cv-2503, 2006 WL 1716881, at *2 (S.D.N.Y. June 21, 2006) ; see also Plazza et al. v. Airbnb, Inc. , 289 F.Supp.3d 537, 549 n.19 (S.D.N.Y. 2018) (finding that failure to recall assent to a clickwrap agreement "does not create a meaningful dispute of fact"); Kutluca et al. v. PQ N.Y. Inc. et al. , 266 F.Supp.3d 691, 702 (S.D.N.Y. 2017) ("[W]hether or not [the users] remember [assenting to the clickwrap agreement], the evidence demonstrates that [the users] could not have proceeded to use the [software] ... unless they accepted the [agreement], which renders [their] failing memories irrelevant." (citations omitted) ); Zalta , 280 F.Supp.3d at 504 n.3.

For the reasons that follow, the Court finds that Broker Genius can show that Gainor assented to the Updated Terms of Use on July 7, 2016.

1. The Original Terms of Use

According to Broker Genius and its three employees who testified at the hearing, all new customers are required to assent to the Terms of Use upon creation of their Broker Genius accounts as part of the registration process, which occurred on the Broker Genius website. (Ellman Test., Tr. 40; Berrick Test., Tr. 133; Sherman Test., Tr. 285; Pl.'s Pre-Hr'g Mem. 10.) The new customers manifested their assent to the Terms of Use by ticking a checkbox, and they were unable to complete their registration unless the checkbox was ticked. (Sherman Aff. ¶¶ 13, 15.) The assent was recorded by Broker Genius in a spreadsheet with the user's email address and a timestamp and a server automatically generated three identical emails to: (1) Broker Genius's vice president of sales, (2) "sales@brokergenius.com," and (3) the email address the new user entered during registration. (Sherman Aff. ¶ 15; Email from Brokergenius to Ellman, May 26, 2016, PX-5; Ellman Test., Tr. 48-49; Sherman Test., Tr. 287.) Part of the registration process was a phone call between the new user and a Broker Genius employee; if the new user had not yet completed the steps to create the account including assenting to the Terms of Use, the new user would be required to do so during the phone call. (Ellman Test., Tr. 52.)

Broker Genius claims this is exactly what occurred in Gainor's case. Although none of the Broker Genius witnesses specifically recalled Gainor's registration, their consistent-albeit self-serving-testimony was that any departure from the normal process would have been at odds with important company policy and training if it permitted a customer to circumvent agreeing to the Terms of Use. (Berrick Test., Tr. 139-40; Ellman Test., Tr. 83-85.)

Defendants claim that the Broker Genius employee created Gainor's account for him during or in advance of their phone call-including entering Gainor's email address and assenting to the Terms of Use. (Defs.' Pre-Hr'g Mem. 16-17, ECF No. 70; Defs.' Post-Hr'g Mem. 12-13.) In addition, defendants' expert, Ms. Martin, found that the then-existing code permitted a user to create an account without assenting to the Terms of Use. (Martin Test., Tr. 610-11.) Defendants also suggest that a contemporaneous email where Ellman sent Gainor the unencrypted password for Gainor's new account supports their view that someone at Broker Genius must have been involved in creating Gainor's account. (Defs.' Post-Hr'g Mem. 12-13.) Ellman testified in reply that, at the time, Broker Genius's software permitted select administrators, including him, to view customer passwords without encryption. (Ellman Test., Tr. 59-60, 110-11.)

Because of the conflicting evidence, and because the Court finds in any case that Gainor assented to the Updated Terms of Use-which are identical to the Original Terms of Use in all respects relevant to this litigation-the Court draws no conclusions as to whether Gainor assented to the Original Terms of Use.

2. The Updated Terms of Use

The Terms of Use were updated on June 6, 2016 (Updated Terms of Use, PX-15), and users were invited to assent to the Updated Terms of Use beginning on July 7, 2016 (Sherman Test., Tr. 289). This invitation arrived in a pop-up window that alerted users to the fact of the update, and permitted them to assent by entering their full name and email address and clicking a button. (Ellman Test., Tr. 63-64; Sherman Test., Tr. 290.) The assent was recorded in a spreadsheet with the user's name, email address, and a timestamp (Email from Crystal to Ellman, Mar. 14, 2017, PX-90), and the server automatically generated a confirmation email to the email address provided (e.g. , Email from Brokergenius to Grudzinski, July 7, 2016, DX-A; Email from Brokergenius to McNee, July 7, 2016, DX-B; Email from Brokergenius to Agarwal, July 7, 2016, DX-C; Email from Brokergenius to Assaf, July 7, 2016, DX-D). After July 7, 2016, no Broker Genius customer was able to use AutoPricer until that customer assented to the Updated Terms of Use. (Ellman Test., Tr. 63-64; Sherman Test., Tr. 290.)

In Gainor's case, the timestamp indicates that he assented to the Updated Terms of Use on July 7, 2016, at 12:56 p.m. (Email from Crystal to Ellman at 2, PX-90.) Although Gainor testified that he did not recall assenting (or not assenting) to the Updated Terms of Use (Gainor Test., Tr. 472-73), the fact that he continued using AutoPricer after July 7 was undisputed, and defendants did not offer any theory for how Gainor was able to maintain his access if he had not assented to the Updated Terms of Use. Notably, Ms. Martin formed no opinion as to whether the then-existing code would have permitted a user to continue using AutoPricer without assenting to the Updated Terms of Use (Martin Test., Tr. 612), as she did with respect to the Original Terms of Use (Martin Test., Tr. 610-11). Therefore, the Court finds it is more likely than not that Gainor could not have continued using AutoPricer after July 7 unless he had assented to the Updated Terms of Use.

Because Gainor did in undisputed fact continue to use AutoPricer after July 7, and because Broker Genius's records reveal that Gainor clicked to accept the Updated Terms of Use on July 7, the Court finds that Broker Genius can likely show that Gainor did in fact assent to the Updated Terms of Use on that date. See Eslworldwide.com , 2006 WL 1716881, at *2.

B. The Terms of the Contract

"Under New York law, a written contract is to be interpreted so as to give effect to the intention of the parties as expressed in the unequivocal language they have employed." Terwilliger v. Terwilliger et al. , 206 F.3d 240, 245 (2d Cir. 2000) (quoting Cruden v. Bank of N.Y. , 957 F.2d 961, 976 (2d Cir. 1992) ). The interpretation of a contract is a question of law for the court unless the contract is ambiguous, in which case "interpretation of the contract becomes a question of fact for the finder of fact and extrinsic evidence is admissible." Random House, Inc. v. Rosetta Books LLC , 150 F.Supp.2d 613, 618 (S.D.N.Y. 2001) (finding contract unambiguous in decision on motion for preliminary injunction), aff'd , 283 F.3d 490 (2d Cir. 2002). "Determining whether a contract provision is ambiguous is a question of law to be decided by the court." Id.

Here, the parties have not suggested that the Terms of Use are ambiguous. Nor have they directed the Court to any extrinsic evidence of the contract's meaning. The Court therefore follows the parties' lead, comfortable that the relevant language of the Terms of Use is sufficiently "unequivocal" "so as to give effect to the intention of the parties." Terwilliger , 206 F.3d at 245. Since the Terms of Use are unambiguous, it is for the Court to interpret them as a matter of law. Random House , 150 F.Supp.2d at 618.

The contractual provision at issue is the prohibition against "distribut[ing] or creat[ing] derivative works of the Site or Apps or the Content," that is, AutoPricer. (Updated Terms of Use, PX-15.) The parties agree that this provision is not a noncompetition clause and that the contract does not otherwise contain one. (Sherman Test., Tr. 361.) This means that the Terms of Use do not preclude Broker Genius customers from competing against Broker Genius; they only preclude the creation of a competitive product that is derived from AutoPricer.

As for how to interpret the contractual term "derived," both sides apply the same definition from the Merriam-Webster Dictionary: "something that originates from something else." (Koskinen Report 4; Martin Report 4.) Beyond that, the parties have not favored the Court with any view, argument, or authority on how the Court should interpret the contract in this breach of contract case.

Nonetheless, it is "unequivocal," Terwilliger , 206 F.3d at 245, that if a later-created product is derived from an earlier product, two things will be true. First, the two products, or elements therein, will be similar . Similarity, of course, is a matter of degree.

Second, the commonalities present in the later-created product will be traceable to the earlier one. Evidence that common elements were already known to the industry generally or to a defendant specifically is circumstantial evidence that a later-created product is not traceable to an earlier one, despite the presence of commonalities. Defendants' briefs go much further, presuming that the existence of "prior art," as that term is used in patent law, precludes a finding that a later-created product is derivative of an earlier one. (See Defs.' Pre-Hr'g Mem. 22-25; Defs.' Post-Hr'g Mem. 30-39.) If that were true, the contractual prohibition against derivative works would be a nullity whenever a user could have created a work based on prior art, even if it is actually derivative. Although this may be accurate as a matter of patent or copyright law, see Computer Assocs. Int'l, Inc. v. Altai, Inc. , 982 F.2d 693, 706 (2d Cir. 1992), defendants do not assert that the Terms of Use imported this rigid limitation, and a reasonable reading of the word "derive" does not include one.

For instance, a businessperson seeking a competitive advantage might be motivated to snoop around a competitor's product-he might even pose as a customer in order to acquire information that would be otherwise inaccessible to him. If the faux customer then used what he learned to develop his own competitive product, the latter would clearly be traceable to the earlier product, no matter whether the common elements also resembled "prior art."

A company seeking to prevent such behavior is certainly entitled to require its customers to assent to a noncompetition agreement. However, such an agreement would be broader than the Terms of Use here, as it would preclude customers from competing at all, even with a product that was not derivative. Since the right to compete is clearly valuable, there would have been a cost to Broker Genius had it imposed a noncompetition agreement on its customers. Correspondingly, there would have been a cost to Broker Genius's customers had Broker Genius agreed to forego a covenant against derivative works altogether, since the right to create such works has value as well.

The bargain struck by the parties here was right in the middle. In exchange for payment and, inter alia , a promise not to create or distribute derivative works-but not a promise not to compete-Gainor received a license to use AutoPricer. It is not for the Court to second guess that bargain, but to apply it to the facts of this case to determine whether the contract was breached.

C. Command Center Was Derived from AutoPricer in Breach of the Contract

When Gainor assented to the Updated Terms of Use, he specifically agreed not to "distribute or create derivative works of" Broker Genius's AutoPricer. This precluded Gainor from distributing or creating a work that was substantially similar to AutoPricer if the similarities were also traceable to AutoPricer. After assenting to the Terms of Use and using AutoPricer, Gainor, with the other defendants, created and distributed their product, Command Center. For the reasons that follow, the Court finds that Broker Genius is likely to succeed in showing that Command Center is substantially, even surprisingly, similar to AutoPricer, and the similarities are traceable to AutoPricer, and that, as a result, Command Center is derivative of AutoPricer in violation of the Terms of Use.

1. Command Center Is Extraordinarily Similar to AutoPricer

The substantial and pervasive similarities between Command Center and AutoPricer are essentially undisputed, and for good reason: the similarities, described earlier, are undeniable. Any differences between the two products are vastly outweighed by the extensive similarities in design and functionality.

As described earlier, Dr. Koskinen grouped the key similarities into two broad categories, and the Court finds that framework useful. The multitudinous ways in which the products are similar reflects countless decisions, large and small, by the developers, which collectively resulted in a web application particularly optimized for secondary-market ticket brokers to price their tickets dynamically and automatically through the creation of pricing rules.

The first category of similarities is the overall architecture of the two products and their UI/UX. The architecture is the same in each product, and the UI/UX is substantially similar. The common architecture consists of a web-based application that acts as an intermediary between POS systems and ticket exchange systems, applying dynamic automatic pricing rules. The common UI/UX consists of the particular cascading flow of widgets that enables users to create, monitor, and update the dynamic automatic pricing rules. See supra , § II.F.

The second category of numerous similarities is the widgets in each product's cascade, which are identical in function and substantially similar in the features they contain. They also interrelate with each other and with external systems in essentially the same way, and have internal characteristics that are substantially similar. See supra , § II.F.

Dr. Koskinen described a third similarity as well: both products employ the same means of addressing the scalability problem. See supra , § II.F.

Defendants do not primarily contend that AutoPricer and Command Center are not similar. Instead, they set forth nonculpable explanations for the pervasive similarities. Those explanations are addressed in the next section of this Opinion.

To the extent defendants do argue that there are differences between AutoPricer and Command Center, the most important difference highlighted by defendants is that everything takes place in AutoPricer on a single page, whereas in Command Center, each widget has its own page. However, as Dr. Koskinen testified at the hearing, "the overall flow that you see of how the different widgets interact is the same in both AutoPricer and Command Center," and "that's a more important factor than whether something is on one page or the same page or a different page." (Koskinen Test., Tr. 222.) The Court agrees.

Another difference described by Ms. Martin is that whereas AutoPricer has separate widgets for Zones/Sections/Rows and Price By Comps, Command Center integrates them into a single widget. Although this is a nontrivial difference in the UI/UX between the two products, it is minor compared to the products' substantial similarities.

Other differences that defendants point to are even less consequential, including that a user clicks on the interactive map in AutoPricer but hovers over the map in Command Center, and the fact that a Command Center user has to click on the words "Command Center" after logging in to the Seat Scouts website but does not have to click on the word "AutoPricer" on the Broker Genius website. See supra , § II.F.

In sum, the similarities identified by Broker Genius are not limited to any particular features or components, but go to the heart of the two products. As a result, the Court finds a strong likelihood that Broker Genius can show that Command Center is substantially similar to AutoPricer.

2. The Similarities in Command Center Are Traceable to AutoPricer

The critical issue before the Court is whether the overarching similarities in Command Center are in fact traceable to AutoPricer. The governing contract requires the Court to consider whether Gainor actually derived Command Center from AutoPricer-not simply whether he could have derived it based on his access, nor whether he could have developed it independently based on the state of his, and the industry's, knowledge.

There is ample circumstantial evidence of copying by Gainor even though there is no direct evidence of copying.

Mindful of the fact that Broker Genius "need not show that success is an absolute certainty" to obtain a preliminary injunction, but "need only make a showing that the probability of [its] prevailing is better than fifty percent," the Court finds that Broker Genius has more than met its burden here, for the reasons that follow. Eng , 849 F.2d at 82 (quoting Abdul Wali , 754 F.2d at 1025 ).

i. Gainor had access to AutoPricer and utilized that access in his business to price tickets

Gainor's purposeful access to and attentive and repeated use of AutoPricer is undisputed. He testified at the preliminary injunction hearing that he began using AutoPricer in May of 2016 and used it until the end of December 2016, when the Minnesota Vikings season ended. (Gainor Test., Tr. 424-25, 453.) In order to price and monitor his tickets during that period, Gainor was necessarily interacting with AutoPricer's six widgets and proceeding through its cascade. Gainor's use of AutoPricer's architecture, UI/UX, widgets, and other features, enabled him to learn which aspects he thought worked well, whether or not his intent at that time was to develop his own competitive product. On September 18, 2016, Gainor even made a note to himself listing certain features of AutoPricer that he viewed as effective, in the course of beta testing the Seat Metrics product for Seat Metrics. (Gainor Evernote titled "Seat Metrics," Sept. 20, 2016, PX-8; Gainor Dep. 45-47, Dec. 12, 2017, PX-1.)

Sherman testified that Gainor's account permitted Gainor to continue accessing AutoPricer even after he stopped using it, and that his access was not cut off until his account was disabled on April 27, 2017, (Sherman Test., Tr. 304-05, 359-60), although, there was no evidence that Gainor accessed AutoPricer in 2017, (Sherman Test., Tr. 359-60).

ii. Gainor's access to and use of AutoPricer was followed immediately by his rapid development of Command Center

The short-essentially nonexistent-interval between Gainor's access to and use of AutoPricer, on one hand, and his initial steps toward developing the product that became Command Center, on the other, is further circumstantial evidence that the similarities in Command Center are derived from AutoPricer.

Gainor did admit that he used AutoPricer until the end of 2016. (Gainor Test., Tr. 424-25, 453.) The next week-on January 8, 2017-Gainor created what he admitted constituted his "first draft" of defendants' Command Center product. (Gainor Evernote, PX-18; Gainor Test., Tr. 538.) That "first draft"-in which the name "Command Center" is already present-described the specific primary elements that were also present in AutoPricer, including all six widgets: "Event Listings," "Ticket Listings," "Select every zone, section and row in one click," "Comparable criteria," "Grouping," and "Apply rule to season tickets." (Gainor Evernote, PX-18.) Those same elements as well as others in the "first draft" were incorporated into the final Command Center product. (Gainor Test., Tr. 538.)

One week after the first draft, that is, a mere two weeks after he stopped using AutoPricer, Gainor sketched mockups-or "wireframes"-for Command Center and created at least ten tasks in Pivotal Tracker, a project management tool used to assign and manage tasks for coders. (Gainor wireframes, PX-19; Gainor Pivotal Tracker entries, PX-145; Koskinen Report, Ex. E; Gainor Test., Tr. 499.) Elements of the wireframes and tasks-such as attributes of pricing rules, event search fields, ticket grouping, and the interactive map-were also present in Broker Genius's AutoPricer. In addition, the same elements and others in the wireframes and tasks found their way into the final Command Center product.

Dr. Koskinen testified that the first draft, wireframes, and Pivotal Tracker tasks indicate that, by the beginning of January, Gainor already "had a fairly clear idea about ... what he wanted to build and [the] requirements for it." (Koskinen Test., Tr. 213-215.) Notably, Ms. Martin neither reviewed these documents nor took them into consideration in forming her opinion that Command Center was likely not derived from AutoPricer. (Martin Test., Tr. 637-38.)

The Court credits Dr. Koskinen's testimony, and finds that it is further supported by other evidence in the record. Most persuasive is Gainor's own testimony that the impetus for creating the first draft and the wireframes was his experience using AutoPricer. (Gainor Test., Tr. 436.) Although Gainor testified that it was AutoPricer's shortcomings that inspired him to create a better product, it is beyond belief that he considered only the elements in AutoPricer that he did not like, and ignored the ones he did, when listing requirements for his competitive product one week later. On its own, this is strong evidence of traceability.

In addition, Gainor's January 8, 2017, email to defendant Guinio Volpone stating that Gainor "want[s] to build [an auto pricer] more than ever!" and that "[a]fter this weekend, I think we can build the best pricing view/Auto pricer in the industry!" permits an inference that the two had earlier discussions about developing a competitive autopricer-including while Gainor was using Broker Genius's product. (Email from Gainor to Volpone, PX-11.)

After this, Command Center's development proceeded at a rapid clip. See supra , section II.E. When Seat Scouts announced its forthcoming autopricer in July of 2017, Gainor's erstwhile partner at Seat Metrics noted (with apparent mistrust) the surprising speed with which Command Center had seemingly been developed. (Email from Panzer to Gainor, PX-12 ("[L]ooks like you built that pretty quickly. It must have been in development while you were beta testing with us, no?").)

iii. Defendants' incorporation of key elements of AutoPricer into Command Center was not the result of independent requirements engineering

Requirements engineering is the process of "identifying all aspect[s] of" how a piece of software should operate, "including both the functional (e.g. features) and non-functional (e.g. performance, security, etc.) aspects." (Koskinen Report 24.) Dr. Koskinen identified several hallmarks of requirements engineering in his expert report, including project management, wireframes, software version control, multiple releases, creation of source code, behavior tracking, analysis of feature requests, customer user studies, and A/B testing. (Koskinen Report 30.) Requirements engineering is especially critical when developing UI/UX, because "[u]sers don't always behave as expected so ... it is difficult to know how to build software that interfaces humans with machines." (Koskinen Report 29.) This is true even where software is built by combining "readily available components." (Koskinen Report 29.)

Dr. Koskinen "did not find evidence of any significant requirements engineering process that lead to the software requirements" set forth in Gainor's early documents-the first draft, the wireframes, and the Pivotal Tracker tasks. (Koskinen Report 36-37; see also Koskinen Test., Tr. 216, 276; Gainor Dep. 199-200, PX-1.) Those early documents, as already described, included key elements of AutoPricer that found their way into Command Center. Dr. Koskinen also found no evidence of any user feedback of any kind whatsoever in the development of Command Center. (Koskinen Test., Tr. 272.)

Notably, in forming her opinion that Command Center was not derived from AutoPricer, Ms. Martin did not consider the development process for Command Center nor did she review any documents pertaining to its development. (Martin Test.