Our client, we’ll call them Company X, provides installation, connection, upgrades and repairs for one of the country’s largest providers of residential and commercial television, telephone and Internet service. We’ll call their customer Company Y. Pursuant to their contractual agreement, our client (Company X) retained a third party vendor to conduct civil and criminal background checks on job applicants. However, in the last year Company Y was purchased by Company Z, an even larger provider of television, telephone and Internet services. Company Z requires our client to utilize a different third-party vendor for conducting background checks.
This summer, several automakers, including Tesla, Toyota, General Motors, Ford, and Volkswagen learned that their closely held trade secrets were readily available on the internet. The source? An unprotected back-up server. The rub? The server did not belong to any of the car manufacturers. Instead, the server belonged to a vendor of industrial automation services, Level One Robotics and Control (“Level One”), who had performed work for each of the manufacturers.