IP Law Daily, COPYRIGHT—7th Cir.: Copyright and trade secrets lawsuit over ‘Magic Money Machines’ leaves plaintiff short of change, (Jul 31, 2026)

By Matthew Hersh, J.D.

The district court rightly awarded attorney fees after the defendant prevailed on all counts.

A software company failed to come forward with enough evidence to defeat summary judgment on its claim that a competitor infringed on its copyrights and misappropriated its trade secrets when it took over a contract to develop software for coin-counting machines, the U.S. Court of Appeals for the Seventh Circuit has held. The court, in ruling for the competitor on the merits rather than the corporate-liability grounds that had prevailed below, also found that the district court correctly assessed attorney fees on the software company (Arkeyo LLC v. Saggezza, Inc., No. 25-1577 (7th Cir. Jul. 30, 2026)).

The lawsuit revolves around a popular series of kiosks, known as “Magic Money Machines,” that were designed to allow customers to deposit spare change for free at certain branches of UK-based Metro Bank. The bank hired Pennsylvania company Arkeyo in 2010 to design the software for the machines. But in 2015, when Arkeyo’s software had become outdated, the bank began a transition to Chicago software firm Saggezza. In connection with that transition, the bank delivered an Arkeyo touchscreen computer to Saggezza for use as a “reference point” for the user experience and certain features that Metro wanted the new software to include. Saggezza was eventually unable to log into the computer and ultimately did not use the computer to develop its new software.

Arkeyo responded with a number of lawsuits against, in the words of the court of appeals, “virtually everyone involved in developing the new software.” One of those lawsuits, filed in the Northern District of Illinois, asserted claims against Saggezza for direct and contributory copyright infringement, misappropriation of trade secrets, tortious interference, and conversion. The district court at first denied a motion to dismiss the lawsuit, but eventually granted summary judgment to Saggezza on the grounds that it could not be liable for the conduct of its UK subsidiary. The district court later awarded Saggezza attorney fees under the Copyright Act’s fee-shifting provision.

Arkeyo appealed, leading to this opinion.

Copyright infringement. The court affirmed the judgment—but rather than rely on the district court’s analysis of which company could be held responsible, chose to decide the claim on its merits instead. The court first addressed of the copyright infringement claim, noting that nothing in the record suggested that Saggezza’s software “contains any protectable elements of Arkeyo’s source code.” Arkeyo acknowledged this fact, but rested its infringement claim on three asserted similarities—the Arkeyo logo appearing on one machine running on the Saggezza software, an “audible knocking feature,” and a bug in the Saggezza software’s coin-counting functionality that allegedly mirrored one in Arkeyo’s—that it claimed “defy coincidence.” But the court disagreed. “The programs run on different versions of Windows and use different methods to display animations,” the court noted. “Further, Saggezza’s code is shorter and more efficient than Arkeyo’s code, reflecting a fundamentally different software development approach.” In light of these “fundamental differences,” the court concluded, “it is not reasonable to draw an inference of copying from the similarities to which Arkeyo points.”

Trade secret misappropriation. The court also rejected Arkeyo’s claim of trade secret misappropriation. The trade secret claim, the court noted, appeared to focus on the source code of Arkeyo’s software as well as certain features of that software “separate and apart from the source code.” The code itself could not have been a trade secret, the court found, because the company made a full version of its software publicly available at a now-defunct URL The company claimed that the code remained effectively secret because, in order to access the code, one would need to “guess” the URL where it was located. But that guess would not be too hard, the court noted, given that the website began with Arkeyo’s website domain and the remaining 12 characters “would be a relatively obvious guess for someone looking to find Arkeyo’s software.”

As to Arkeyo’s claim regarding the specific features of its software, this argument too failed. Arkeyo’s trade secret claim rested mostly on “functionalities” that would be apparent to anyone operating the software, the court noted, such as “receipt functionality”; an “on-screen game”; “accurate handling and processing of British coin currency”; and other “features visible to consumers.” These “publicly disclosed, readily ascertainable features are not entitled to trade secret protection,” the court found.

Common law torts. The court also found that Arkeyo’s common law claims were meritless. The “gravamen” of Arkeyo’s tortious interference claim, the court noted, is that Saggezza interfered with Arkeyo’s agreement with the bank by pitching itself as a developer of replacement software for the Magic Money Machines while the agreement was still in effect. “But Arkeyo does not explain why it was wrongful for Saggezza, Arkeyo’s competitor, to offer a better product to convince Metro to take its business elsewhere,” the court noted. As to Arkeyo’s claim of conversion, the court noted, it was the bank—not Arkeyo—that owned the machine that Saggezza examined.

Attorney fees. Finally, the court affirmed the district court’s decision to award attorney fees to Saggezza. There is a “strong presumption” in the Seventh Circuit that winning copyright defendants are entitled to fees, the court noted, “and the district court was well within its discretion to heed that presumption in light of Arkeyo’s objectively baseless copyright claims.”

The Case is No. 25-1577.

Judge: Jackson-Akiwumi, C.

Attorneys: Douglas R. Johnson (Law Offices of Douglas R. Johnson, PC) for Arkeyo LLC. Vivek Jayaram (Jayaram Law) for Saggezza, Inc.

Companies: Arkeyo LLC; Saggezza, Inc.

Cases: Copyright TradeSecrets IllinoisNews IndianaNews WisconsinNews GCNNews