and carry a big stick--another (minor) win
Court Refers DGI Employees to U.S. Attorney's Office
for Criminal Prosecution
DALLAS, Nov. 18 /PRNewswire/ -- DSC Communications Corporation
(Nasdaq: DIGI) announced today that Judge Joe Kendall of the U.S. Federal
District Court for the Northern District of Texas issued a final judgment and
permanent injunction against DGI Technologies of Richardson, Texas. The court
found that DGI had stolen trade secrets owned by DSC and infiinged DSC
copyrights. The court also indicated in its order that it has referred
certain DGI employees to the U.S. Attorney's Office for potential criminal
prosecution for what the court believes to be theft of intellectual property.
The court stated specifically that "...DGI would not be in competition with
DSC but for them being thieves."
The court's powerful injunction against DGI prohibits them from:
1. Making or selling products designed, developed or tested with the
assistance or use of, or with reference to, DSC's operating system
software.
2. Developing new or replacement products using current or former DGI
employees, agents or consultants who had illicitly gained knowledge of
DSC's intellectual property.
3. Selling, loaning, giving or providing to any DSC switch owner... a
device not manufactured by DSC that requires for its operation DSC's
operating software or in any way causing DSC customers to violate the
terms of their software license agreement.
The court's judgment also requires that, within 30 days, DGI must deliver
to DSC all DGI DMP-2800 or other microprocessor cards for destruction.
DSC's vice president and general counsel, George Brunt, said, "DSC is
pleased that the federal court has seen fit to issue a sweeping permanent
injunction in this matter. It is particularly significant, since I am not
aware of one product DGI makes or sells that does not violate one or more
terms of the injunction."
Brunt also noted that "The court's decision makes it clear that any
manufacturer of plug-compatible circuit cards that download or use DSC
copyrighted proprietary software is guilty of contributory copyright
infringement. Further, customers who use such cards are committing direct
copyright infringement."
The court also awarded DSC $11.3 million in damages which were offset by
an $11 million award to DGI against DSC for interfering with DGI's business.
In this connection, Brunt stated: "DSC took aggressive steps, which we
believed were within our rights, to stop DGI from stealing and selling
products utilizing DSC intellectual property. The net result is a judgment of
$300,000 in favor of DSC which accumulates interest until paid in full."
Brunt concluded: "When you are in the technology business, such as DSC
is, critical technology property must be protected from wrongful use. This
judgment is an important notice to those who would steal and trade on
another's hard work and ingenuity." |
