IBM Takes Down LzLabs in Intellectual Property Dispute
In a major victory, IBM has won a significant legal battle with Switzerland-based company LzLabs. The UK court found that LzLabs had conspired to breach the licensing agreement of Winsopia, a subsidiary, in an effort to reverse-engineer critical mainframe technology.
IBM's defense was able to prove that LzLabs' actions were deliberate and systematic, with the intention of stealing Big Blue's intellectual property. This technology has billions of dollars invested by IBM.
The Case Against LzLabs
LzLabs acquired an IBM mainframe and then allegedly reverse-engineered the software to build its core Software Defined Mainframe (SDM) package. The court found that this was done in breach of the licensing agreement between IBM and Winsopia.
The SDM is designed to allow IBM mainframe customers to run their existing applications without mainframe hardware or software. However, LzLabs used this technology to develop its own products, making false and misleading claims about their capabilities.
A History of Mainframe Litigation
This ruling comes after a long-standing dispute between IBM and LzLabs. The court documents show that IBM licensed its mainframe software to Winsopia in 2013, but LzLabs used this access to develop the SDM by unlawful reverse engineering.
IBM had previously accused LzLabs of making false claims about the capabilities of their products. This is not the first time IBM has taken on a company that it alleges has misused its mainframe technology.
A Second Victory for Big Blue
This ruling comes as IBM also won another legal battle with its mainframe technology. The U.S. Supreme Court declined to take up a $1.6 billion contract dispute between IBM and BMC software.
BMC had asked the justices to reconsider a U.S. appeals court's decision that overturned its win against IBM. AT&T had hired IBM to run its mainframe operations, but BMC claimed that IBM breached their contract by replacing their software with Big Blue's.
More Mainframe Litigation Ahead
The ruling will determine damages or further actions in the case. Another hearing at an undetermined date will decide on this. This decision highlights the ongoing legal battles between major tech companies.
IBM's History with LzLabs and Neon Software
IBM has previously noted that LzLabs is owned and run by some of the same individuals who owned and ran Neon Enterprise Software, LLC in Austin, Texas. Neon had also attempted to free ride on IBM's mainframe business.
In prior litigation between IBM and Neon, a U.S. District Court permanently barred Neon and certain key employees from reverse engineering, compiling, or translating certain IBM software. The court also prohibited them from distributing certain Neon software products.
Conclusion
The LzLabs ruling is a significant victory for Big Blue in its ongoing efforts to protect its mainframe intellectual property rights. This decision highlights the importance of protecting intellectual property and the consequences of breaching licensing agreements.