From: hughes@ah.com (Eric Hughes)
Date: Thu, 15 Sep 94 07:34:16 PDT
To: cypherpunks@toad.com
Subject: RC4 Legal Issues
In-Reply-To: <199409150624.AA01543@hummingbird.cs.arizona.edu>
Message-ID: <9409151354.AA03733@ah.com>
MIME-Version: 1.0
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   Can RC4 still be construed as a trade secret or proprirtary to
   RSADS and Bizdos or are, as I understand from previous messages,
   we free to use RC4 now (ignoring the submarine patent issue)?

A trade secret is just that, a secret.  For parties unrelated to the
holder of the secret, once it's no longer a secret, it's not a secret,
and the former holder of the secret has no protection at all.  In
other words, if you're not, say, a BSAFE licensee, you are free to use
the alleged RC4 algorithm.

Let me repeat.  If you've never made an agreement with RSADSI about
not distributing their trade secrets, RSADSI has _no_ claim against
you about the trade secret.  (I don't know if the name "RC4" is
trademarked.)

Note the use of the word 'unrelated' in the sentence above.  The
situation is hazier there.  Both licensees and agents (including
employees) of the holder of the secret are liable for damages if they
breach the trust of the secret holder by revealing the secret.  This
liability, however, does _not_ make the secret any less revealed.  The
former holder can sue for damages, assuming there's someone to sue and
the damages can be ascertained.

If you're the user of a product which includes RC4, like Lotus Notes,
for example, the agreement between Lotus and RSADSI about protection
of trade secrets doesn't apply to you, assuming you don't work for
Lotus or RSADSI.  You weren't a party to the agreement, and its terms
don't directly affect thrid parties.  You made a (shrink-wrap)
agreement with Lotus, not RSADSI.

Eric