Conversion of Intangible Property

 The traditional rule for conversion is any unauthorized act which deprives a person of “his property permanently or for an indefinite amount of time.”    Blacks Law Dictionary, Sixth Edition, citing Catania v.Garage De e Paix, Inc., 542 S.W.2d 239, 241. 


Today, personal information such as banking information is stored on laptops, credit card numbers are “remembered” by online services and iPhones contain a verity of personal information.  Can intangible electronically stored information be subject to conversion?  

 Courts have allowed causes of action for conversion of electronic information or “intangible property.”  Cases such as Thyroff v.Nationwide Mut. Ins. Co., 2007 NY Slip Op 2442 found the state of New York has a common law cause of action for conversion of electronic information.  The Court stated:  

 …it generally is not the physical nature of a document that determines its worth, it is the information memorialized in the document that has intrinsic value… In the absence of a significant difference in the value of the information, the protections of the law should apply equally to both forms–physical and virtual. Thyroff v.Nationwide Mut. Ins. Co., 2007 NY Slip Op 2442, 9 (N.Y. 2007).

 The common law remedy of conversion of intangible property is highly similar to, but different than, the statutory remedy of identity theft.  California law defines identity theft as the “unauthorized use of another person’s personal identifying information to obtain credit, goods, services, money, or property.”  Cal Civ Code § 1798.92(b).   In short, conversion is the act of depriving someone of their property, where identity theft is the act of obtaining a benefit from it.

 There could be many differences in the application of these common law and statutory remedies, such as a music artist being deprived the original music created on their laptop.  In that situation, conversion is more approrpriate more appropriate then identity theft.  However, states that have not enacted identity theft statutes might be able to find common law remedies for conversion of electronically stored information for those who are the victim of digital torts.