A federal judge has ruled that a lawsuit filed by IT management software and solutions vendor CA (NASDAQ: CA) against Rocket Software, which creates software on an OEM basis, can go ahead.
The suit, initially filed in the United States District Court for the Eastern District of New York in May of 2007, claims Rocket stole some of CA’s source code and used the intellectual property to “create many, if not all, of Rocket’s software tools for the IBM’s DB2 relational database management system.”
The case is similar to the $1 billion lawsuit Oracle has filed against SAP for intellectual property theft committed by SAP subsidiary TomorrowNow.
CA’s tools for managing IBM’s DB2 database products compete with those from Rocket, which are distributed through IBM.
CA is seeking injunctions and monetary damages of at least $200 million against Rocket. If granted, the injunctions would prevent the use and distribution of the code, CA senior vice president and chief counsel for litigation Gary Brown told InternetNews.com. That means DB2 users who employ Rocket’s tools would no longer be able to use them.
Rocket Software did not respond to calls for comment by press time. IBM public affairs manager Ari Fishkind also declined comment.
CA’s allegations may not be easy to prove, noted Gartner distinguished analyst Martin Reynolds. “If there’s 15 lines of code in the bowels of a module somewhere there’s not going to be an injunction, but if CA can prove a big chunk of code was stolen, they would get an injunction immediately,” he added.
Pointing out that CA and IBM are competitors, Reynolds said Rocket may have to rewrite the code and IBM would probably need to lend a hand. “Ultimately, if you can pay money to compensate CA, the settlement would go there,” he added.
A competitive patch
Rocket’s Log Analysis Tool competes with CA’s Log Analyzer — both review the logs generated by the DB2 system, diagnose and correct potential problems, and audit DB2 data changes. Rocket’s Query Monitor competes with CA Detector, and both assess the performance of DB2 databases on a system level and on an individual query level.
CA’s amended complaint against Rocket, filed in August of 2007. alleges that Rocket obtained the source code and development environment by hiring programmers and software developers formerly employed by CA, or by Platinum Technology, which CA bought in 1999.
Platinum had developed database administration software products compatible with DB2.
Those employees misappropriated CA’s intellectual property and converted this property to Rocket’s use with Rocket’s knowledge and consent, the complaint alleges.
Rocket’s main defense was that the statute of limitations had run out on CA’s allegations because CA had delayed in bringing the action, and that CA had failed to exercise due diligence in the matter. Judge Arthur D. Spatt tossed that claim.
If the injunction is approved, “it would be effective immediately, which would prevent distribution and use of the Rocket products,” Brown added. If CA wins the trial, it would have the right to ask for a permanent injunction, he said.
Advice for DB2 Users?
Enterprises buying DB2 tools from IBM have to beware. “If you want to buy the stuff, you want IBM to give you an indemnity so that you don’t have somebody from CA coming up to sue you, not that they would,” Gartner’s Reynolds said.
Buyers will also have to make sure that they will get updates and patches for the tools if they purchase them from IBM, Reynolds added. “Also ask what IBM will do for you if Rocket’s going to go out of business,” he said.