Nortel launches suit against rival Optical Networks
Updated 4:31 AM ET March 13, 2000
TORONTO, March 13 (Reuters) - Nortel Networks Corp., a leader in the hot field of optical networking, said on Monday it was suing competitor Optical Networks Inc. for allegedly taking trade secrets and infringing on
Nortel patents with its data transportation product.
The suit also accuses Optical Networks, a private firm which filed with the U.S. Securities and Exchange Commission on Friday to raise $115 million in an initial public offering,
of unlawful business practices and unfair competition.
Optical Networks officials were not immediately available for comment.
Nortel late last year won an injunction from a Montreal court preventing several former employees who defected to Optical Networks -- partly held by Nortel's rival Cisco Systems Inc. -- from trying to lure over other employees of Nortel or three of its contractors and from using certain trade secrets.
In the lawsuit revealed on Sunday, which was filed in California, Nortel accused Optical Networks of
infringing five patents with its Dynamic Transport System (DTS) -- a failure-protected transport system that shifts communications signals over optical networks.
Optical networking, which sends data streaking across networks as pulses of light instead of electronically, is going through a period of explosive growth.
The suit seeks an injunction to stop Optical Networks selling the DTS or soliciting or using Nortel trade
secrets. It also seeks damages, including profits lost through the alleged patent infringement.
Nortel spokesman David Chamberlin said that the DTS product bears a "startlingly resemblance" to Nortel's OPTera product, launched a year ago. Optical Networks sought to hire employees away from Nortel to slot into jobs similar to those they'd held at Nortel at various stages of the product's development cycle, said the Brampton, Ontario-based communications equipment maker in documents
filed in court.
Nortel said that the "employment of these individuals in similar jobs at ONI was designed to encourage them, consciously or unconsciously, to disclose Nortel Networks's technology, trade secrets and other confidential information."
In November, the San Jose Mercury News quoted Optical Networks general counsel Michael Dillon as saying that Nortel's bid for an injunction was not the result of any wrongdoing by Optical Networks.
"What they are trying to do is discourage their employees from pursuing more lucrative and more interesting opportunities in Silicon Valley," the newspaper quoted Dillon as saying.
Chamberlin declined to give details of the amount of revenue the OPTera product contributed and said this was a rare instance of Nortel turning to the courts for changes. |
