Sendo, the tiny British cellphone maker that launched a high-profile lawsuit in 2002 charging Microsoft with dirty tricks, is back with an updated complaint in its acrimonious battle against the Redmond, Wash., software giant.
The revised document, filed last week in the U.S. District Court for the Eastern District of Texas and obtained by internetnews.com, tacks on new claims to Sendo’s original allegations that Microsoft had a “secret plan” to plunder its proprietary information and technical expertise. Sendo’s second amended complaint levels a breach of contract charge as a result of the actions.
“The case is moving ahead,” Sendo spokeswoman Marijke van Hooren told
internetnews.com. “We’re in the discovery phase.”
Microsoft responded that Sendo’s claims are without merit.
The company alleges that a Microsoft employee disclosed “Sendo’s confidential business information and trade secrets” when the two companies worked together from October 1999 through late 2002 to develop what would have been Microsoft’s first Smartphone.
In its initial complaint filed for the suit, Sendo accused Microsoft of engaging in a “secret plan” to put it out of business. Sendo had been working jointly with Microsoft since October 1999 on the development of Sendo’s Z100 “Stinger” phone, which was supposed to incorporate Microsoft’s “Smartphone” software.
But the two companies split up in November 2002, with Sendo charging Microsoft with delaying release of key source code it needed to complete the Z100. For its part, Microsoft hooked up with U.K. cellular carrier Orange as its Smartphone launch partner; Orange released a handset built by Microsoft partner High Tech Computer (HTC) of Taiwan.
[After severing its relationship with Microsoft, Sendo signed on to use Nokia’s software in its cellphones. (Nokia’s Series 60 software platform, which it licenses to companies such as Sendo, consists of a homegrown user interface fitted on top of an operating system supplied by Symbian.)]
According to both Sendo’s original suit and its updated complaint filed last week, “This lawsuit is the result of Microsoft’s master plan to quickly obtain the technology necessary to enter and ultimately dominate the next-generation mobile phone market.”
As a result, Sendo said, Microsoft turned to it for help with technology it needed to enter the market quickly.
“Microsoft set about through a secret plan to obtain that technology and know how from Sendo with false promises that Microsoft would co-develop, help finance, and be the ‘go to market’ partner for Sendo’s 2.5G Smartphone, the Z100,” the complaints state.
“Microsoft then provided Sendo’s proprietary hardware expertise and trade secrets to low-cost OEMs who would not otherwise have had the expertise,” the complaints continue. “In short, Microsoft used Sendo’s knowledge and expertise to its benefit to gain direct entry into the burgeoning next-generation mobile phone market and then, after driving Sendo to the brink of bankruptcy, cut it out of the picture.”
What’s new in the updated complaint is a hefty section detailing Sendo’s claims of boardroom intrigue. Sendo specifically makes charges against Marc Brown, at the time the director of Microsoft’s corporate development and strategy group, who served as the company’s liaison with Sendo.
The update complaint charges Brown with breach of fiduciary duty and with breach of contract. Sendo charges Brown, who for a time sat on Sendo’s board of director, had a conflict of interest. Brown intended to “disclose Sendo’s confidential business information and trade secrets for Microsoft’s benefit and Sendo’s detriment,” according to the new complaint.
Reached at Microsoft, spokeswoman Stacey Drake told internetnews.com: “Sendo’s allegations against Microsoft are counter to our respect for intellectual property. We look forward to presenting the facts in court and refuting Sendo’s baseless claims.”
Sendo’s filing of its updated complaint follows a flurry of evidentiary maneuvers by the company. Since February, Sendo has issued subpoenas to T-Mobile, Dell, Mitsubishi, and British cellular operators Orange and Vodaphone. It has also requested evidence it said is in the hands of Sharp and Hitachi in Japan.
Most recently, Microsoft filed a motion requesting the court to direct Sendo to keep any questions it asks strictly confined to the issues at hand in the case.
Moving forward, the court has not yet set a date by which Microsoft must respond to Sendo’s amended complaint.
