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Deutsche Telekom Unit Sued In Trade Secret Case; U.S. Federal Court Denies Motion To Dismiss, Orders Sigma Six Technologies Case To Proceed

Posted on: Wednesday, 15 July 2009, 10:55 CDT

SAN JOSE, Calif., July 15 /PRNewswire/ -- T-Systems Enterprise Services GmbH, a Germany-based division of Deutsche Telekom (NYSE: DT), has been sued in U.S. federal court by two U.S.-based companies for intentional interference with contract and unfair business practices. The suit, filed in December, 2008 in the U.S. District Court for the Northern District of California, alleges that T-Systems ordered ServiceNet software from Nagarro, Inc. which had been stolen from one plaintiff, with full knowledge of one plaintiff's existing contract with Nagarro to develop ServiceNet. T-Systems and its large enterprise customers throughout the world (including several U.S. household names) use ServiceNet as their enterprise client user interface.

Both T-Systems and Nagarro (a San Jose outsourced software developer with a back office in India) are named as defendants in the 19-page complaint, which alleges breach of contract; theft of trade secrets; tortious interference with contract; and unfair competition under California law. The suit seeks damages expected to reach into tens of millions of dollars. Plaintiffs have requested that the court issue a permanent injunction barring both defendants and all other persons working in concert with them, including all of T-Systems' customers around the world, from in any way using any version or form of ServiceNet.

Last week, U.S. District Court Judge James Ware denied T-Systems' motion to dismiss the complaint for lack of personal jurisdiction, inconvenient forum and German forum selection clause, and ordered the case to proceed to trial in the second half of 2010. Judge Ware ruled that a German forum selection clause was permissive and not mandatory; the court further found that T-Systems had failed to meet its burden on its personal jurisdiction and inconvenient forum arguments. In April, Judge Ware rejected Nagarro's motion to compel arbitration. Said Harry Singh, President and CEO of plaintiff Sigma Six Technologies, Inc., "We are very pleased with the court's ruling that a German company allegedly interfering with American contracts, benefiting from American-owned software and causing harm to American companies, must answer for its actions in U.S. courts. We look forward to pursuing our claims against T-Systems and Nagarro and are confident that our legal system will produce just results."

SOURCE Sigma Six Technologies, Inc.

Source: PR Newswire

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