Twitter’s Threads Threat to Meta Turns on What’s Under the Hood

Twitter is threatening to sue Meta Platforms Inc. over its Threads app, raising the specter of costly trade secrets litigation in a sometimes-nebulous area of law.

Twitter’s owner X Corp. expressed concerns over “recent reports” regarding Meta’s new, Twitter-like app and its hiring of “dozens of former Twitter employees,” in a July 5 letter. Many of the employees retained Twitter devices and trade secrets, according to the letter, which alleged Meta “deliberately assigned” those employees to develop Threads “in a matter of months.”

The letter addressed to Meta CEO Mark Zuckerberg comes days after Meta launched Threads, a microblog site posing direct competition to Twitter, which has generated various controversies since Elon Musk bought it and assumed control in October. Among other actions, Musk fired a significant number of employees, and it’s unclear what share of Meta hires were fired or poached.

Absent a “smoking gun” of copied code or evidence of stolen documents, it can be particularly difficult to separate general skills developed in a job from the secrets those abilities help generate.

Whether Twitter has a case will depend on features under the hoods of the two platforms, and whether Twitter can establish that specific shared aspects were advantageous, secret, and stolen, attorneys said. Absent a smoking gun, it may come down to expert analysis of the site’s source code and internal structure as to whether unique Twitter secrets were incorporated into Threads.

“It becomes a battle of ‘this code developer remembered what they did and did something similar,’” IP attorney Antony J. McShane of Neal Gerber & Eisenberg LLP said. “‘Well, isn’t that just really their skill and expertise writing code?’ It just becomes an argument over that.”

Attorneys varied in their assessment of what the letter showed about the strength of Twitter’s position if it were to sue. The short, vague letter didn’t provide specifics on what X Corp. was alleging, which trade secrets attorney Elisaveta Dolghih of Dolghih Law Group PLLC said was unusual.

“Normally when I send or receive a letter like this, it has more details: names of employees, some description of the information taken. This provides very little information for the company to take action,” Dolghih said. “If I were general counsel and I received a letter like this, I’d have to do a lot of digging to figure out what they were talking about.”

Meta spokesperson Andy Stone directed Bloomberg Law to his Threads post, in which he wrote, “To be clear: ‘No one on the Threads engineering team is a former Twitter employee — that’s just not a thing.’”

Twitter didn’t respond to a request for comment beyond its press contact email’s automated response of a poop emoji. Twitter counsel Alex Spiro of Quinn Emanuel Urquhart & Sullivan LLP, who wrote the letter, also didn’t respond to a request for comment.

‘Strictly Enforce’

X Corp.'s letter said Twitter “intends to strictly enforce” its IP rights and reserved the right to sue “without further notice.” It demanded Meta “take immediate steps to stop using any Twitter trade secrets or other highly confidential information” and to retain any documents that might be relevant to any legal dispute. It also said Twitter rules prevented Meta from crawling or scraping user data.

The letter is a typical first step in cases like this, said IP attorney Fabio Marino of Womble Bond Dickinson, who has litigated Silicon Valley software trade secrets disputes. Trade secrets litigation has become more common recently, especially in states like California—where both X Corp. and Meta are based—where non-compete clauses have been deemed unenforceable by law.

Before X Corp. can get to discovery in California, it would have to identify—not by revealing but by describing with some specificity—the trade secrets that have allegedly been stolen. Trade secrets must be information that derives economic value from not being generally known, and that the entity makes efforts to keep confidential.

“It has to be more specific than something that every competitor in the industry is doing,” IP attorney Jason M. Sobel of Brown Rudnick LLP said. “Unless they can prove a trade secret exists—a concrete one, one they can state with particularity—and that it has been taken, they’re going to be out of luck.”

Attorneys said companies should have onboarding procedures that ensure new employees don’t bring confidential documentation with them or use trade secrets. Marino said he also advises clients not to have new employees do the exact same thing they did at their last job, and to wall them off from areas where they might apply trade secrets.

McShane said reading between the lines of the letter gives him the impression X Corp. is approaching from a strong position. It’s “coming on pretty strong” as it points to “dozens” of employees that built an app within months, he said.

“I think they have something,” he said. “That’s a pretty clear allegation that you wouldn’t make if you didn’t have the ability to substantiate it.”

But California shows significant concern for the right of employees to move from job to job and deploy their skills, trade secrets attorney James Pooley of James Pooley PLC said in an email.

“Unless they did something stupid like bring over confidential source code, the claims against them and Meta will face that fundamental challenge,” Pooley said.

‘Huge Gray Area’

If Twitter has evidence that specific code or documents with secrets were improperly downloaded by ex-employees and incorporated into Threads, the case would be relatively straightforward. Cases become much more difficult if the allegations rest on secrets an employee learned or generated and then simply remembered while recreating a product.

“It’s a huge gray area of the law,” Dolghih said of the line between abilities and the confidential information they generate.

Relying on memory rather than documents or code downloaded from an ex-employee to incorporate trade secrets doesn’t reduce liability, Marino said. But in a practical sense, he added, “if the only evidence that exists is the similarity between the two products, it’s going to be a very hard case to prove.”

“You don’t just have to prove the products are similar, but you have to prove the trade secrets are similar,” Marino said. “The more documentation of the existence of a trade secret, the easier it is to prove it. If it’s just in someone’s head, it’s hard to prove it was a trade secret.”

Some jurisdictions allow for a shortcut to liability absent documentation of a misappropriated secret. The doctrine of inevitable disclosure lets a plaintiff claim a defendant’s new role will inherently lead to reliance on a trade secret. But because that’s effectively an implied noncompete agreement, states that have outlawed them generally reject the doctrine, McShane said.

X Corp. would need to follow up its letter with a lawsuit “pretty quickly” to be successful, Dolghih said.

She noted that a factor in getting a preliminary injunction during litigation is whether the plaintiff would be immediately and irreparably harmed without one. Waiting months after the letter, she said, would tell a court that “it’s clearly not an emergency.”

Marino agreed.

“If it goes the litigation route,” he said, “it often goes very quickly.”