Key Takeaway: Due to the unique release of the Wu-Tang Clan album Once Upon a Time in Shaolin, a federal district court in the Second Circuit has ruled that the album and its music could qualify as a trade secret, despite previous cases rejecting trade secret protection for musical works. This decision emphasizes the importance of having skilled intellectual property counsel who can identify how atypical facts of a case expand the available claims and remedies beyond conventional expectations.
In 2015, rap group Wu-Tang Clan released their seventh studio album, entitled Once Upon a Time in Shaolin (“Shaolin”) – but not in any conventional sense. This release set the music world abuzz because Wu-Tang Clan created only a single copy of the album, deliberately restricting its distribution and access via contract until 2103. Shaolin was sold that same year for over 2 million USD to pharmaceutical executive Martin Shkreli.
Shkreli’s ownership of Shaolin was short-lived. Two years later, Shkreli was convicted on federal securities fraud charges, and ordered to forfeit numerous assets to the U.S. Department of Justice, including the album. In 2021, Shaolin was acquired by PleasrDAO, a digital-art and NFT collective, along with exclusive rights governing access to and playing the audio tracks therein, but with strict contractual limitations to preserve its confidentiality. PleasrDAO intended to use tracks from Shaolin to create private, confidential, exclusive listening experiences for its customers – an approach that traded off the album’s unique rarity and depended entirely upon the album remaining unreleased.
Despite the forfeiture order and contractual confidentiality provisions, Shkreli has repeatedly claimed online that he made copies of Shaolin and had sent or streamed these copies to thousands of people. PleasrDAO filed suit, asserting several claims, including misappropriation of trade secrets by Shkreli under the Federal Defend Trade Secrets Act and New York law.
In a novel decision issued in September 2025, U.S. District Judge Pamela K. Chen of the Eastern District of New York held that Shaolin and its audio tracks could plausibly qualify as a trade secret, allowing PleasrDAO’s claim to proceed past the motion-to-dismiss stage. The court emphasized that this was “unchartered territory,” as courts have historically rejected trade secret protection for unreleased musical works. Those earlier cases reasoned that most musical works derive their value from public release, and therefore lack the independent economic value and confidentiality required for trade secret protection.
Shaolin, however, was different. The album was intentionally created as a single copy work, had never been publicly released, and was sold per an agreement that prohibited its mass dissemination. Critically, PleasrDAO’s business model relied on the album’s continued secrecy to generate value through private, exclusive listening experiences for its customers. Because the album’s economic value flowed directly from its contractually-required confidentiality – rather than mass distribution, the court concluded that PleasrDAO had adequately alleged both the “independent economic value” and “reasonable measures to maintain secrecy” required for trade secret protection.
This case demonstrates the importance of choosing counsel that will tailor legal strategy to the specific facts of your case. In the past, unreleased music has failed to qualify as a trade secret, and a cursory review of prior precedent might have discouraged PleasrDAO’s counsel from asserting such a claim. Here, however, Shaolin’s unprecedented structure and PleasrDAO’s exclusivity-based business model supported a viable trade secret theory, potentially unlocking additional remedies for PleasrDAO.
Judge Chen’s full opinion can be found here- https://cases.justia.com/federal/district-courts/new-york/nyedce/1:2024cv04126/516318/57/0.pdf
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