The Trade Secrets Blog

Following Trade Secrets Litigation

IBM Tries For A Second Bite at the Apple (or Dell in this case)

Back in June I posted on IBM’s lawsuit against it’s former M&A chief, David Johnson, here. IBM sought a preliminary injunction to prevent Johnson from performing his duties at Dell. The Judge denied the preliminary injunction on June 26, 2009, saying that it would unfairly hurt Johnson’s career.

IBM appealed the ruling. However, not satisfied, IBM also sought to revive its motion for preliminary injunction based on the discovery of new evidence against Johnson. The New Brunswick Business Journal is now reporting that U.S. District Judge Steven Robinson denied IBM again. Robinson wrote, “The court shall not allow IBM to litigate this matter through piecemeal, seriatim motions requesting the same relief.” According to Robinson, such a method “is vexatious and does a great disservice to the interests of Mr. Johnson and of the court.”

The litigation appears to center around the validity of a 2005 agreement, specifically, whether it is valid even though it wasn’t properly signed by Johnson and IBM never followed through on threats to take away his equity in the company if he didn’t re-sign it. According to Johnson, he deliberately signed the agreement in the wrong place.

Take away message: Make sure your employees sign any agreements in the correct place. There really is no reason for an employee not to do so, unless he plans on creating wiggle room for himself as Mr. Johnson has done.

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August 7, 2009 Posted by | confidentiality agreement, Intellectual Property, misappropriation, non-compete agreement, trade secret theft, Trade Secrets | , , , | 1 Comment

Silicon Image v. Analogix

Last January Silicon Image sued Analogix in California for copyright infringement, misappropriation of trade secrets, and unlawful, unfair and fraudulent business practices. Silicon Image alleged that Analogix, without authorization and in violation of Silicon Image’s intellectual property rights — copied and used Silicon Image’s proprietary register maps and semiconductor configuration software. In addition Silicon Image sought an injunction barring Analogix from its ongoing infringement of Silicon Image’s intellectual property rights.

If your confused, maybe this will clear it up. According to Silicon Image’s previous press release: “Semiconductor layout designs involve strategic placement of various electronic components, including small memory cells called registers, on interconnected layers of a chip. Silicon Image’s layout designs, including its register maps that identify locations of registers within its chip designs, are its guarded trade secrets. Documentation describing its designs is not publicly disclosed and is provided to Silicon Image’s customers or business partners only under strict non-disclosure agreements. Silicon Image alleges that Analogix copied and used Silicon Image’s register maps by gaining unauthorized access to Silicon Image’s proprietary and confidential information.”

“Along with its chips, Silicon Image has developed, at substantial expense, its semiconductor configuration software. Silicon Image provides the software to its customers who use it to configure Silicon Image chips incorporated in their consumer products. Under its software license agreements, Silicon Image’s semiconductor configuration software can only be used with Silicon Image chips and no other products. Such a restriction is common in the industry. The complaint charges Analogix with illegally copying and modifying Silicon Image’s semiconductor configuration software and knowingly encouraging its existing and prospective customers to modify and use Silicon Image’s semiconductor configuration software with Analogix’s chips, a use that is beyond the scope, and in violation of, the rights granted under Silicon Image’s software license agreements.”

Now that we have the lay of the land. On January 8, 2008, it was reported that the U.S. District Court denied Silicon Image, Inc.’s request for a preliminary injunction.

Both sides are spinning the story in their favor. Analogix released a statement emphasizing that the court denied the request stating that “the evidence gives rise to serious questions on the merits as to this claim.” You can find that press release here.

Silicon Image released its own statement emphasizing that the court had concluded that “Silicon Image has demonstrated a strong probability of success on the question of misappropriation” and that the judge ordered an expedited trial for April 2008 on that basis. The trial was originally set for September 2008. Silicon Image further stated that the judge accelerated the trial date “in light of the evident copying, the serious questions raised by Silicon Image on the merits, and the possibility of irreparable harm.” You can find that press release here.

This is an interesting turn of events and makes one wonder what exactly Silicon Image’s evidence of misappropriation was and why it was not enough for a preliminary injunction but was strong enough to find there had been “evident copying” and warranted an expedited trial. We will continue to follow this case as it progresses and keep you informed of the results.

January 11, 2008 Posted by | Intellectual Property, misappropriation, non-disclosure agreement, trade secret theft, Trade Secrets | , , , | Leave a comment