Trade Secrets Lawsuit/Copyright Infringement Claims Against Microsoft To Proceed To Trial

A lawsuit alleging trade secret and copyright infringement litigation was filed by Symantec security products subsidiary against Microsoft in 2006: Veritas Operating Corporation v. Microsoft Corporation, Case No. 2:06-CV-00703-JCC (W.D. Washington). The case arose from a 1996 agreement between Symantec and Microsoft, whereby Symantec had shared its source code in certain software products for Microsoft to uses in its operating systems and server software. Symantec alleged that Microsoft breached their agreement by modifying the software in ways that were exclusively reserved to Symantec and expressly prohibited, thereby running afoul of Symantec’s trade secret rights and copyrights. Microsoft filed for summary judgment of non-infringement of Symantec’s alleged trade secrets, copyrights, and other claims.

On February 4, 2008, the Court denied most of Microsoft’s requests. The Court ruled that it was not persuaded that Microsoft did not breach its agreement and that Veritas had presented enough evidence to establish its trade secret rights in the private interfaces and other information. The Court also noted that Veritas had provided credible evidence of bad faith, one in the form of an email summarizing a statement by one of Microsoft’s managers on the project, who admitted that:

his intention is to eventually get [Symantec] out of the box because he believes we should not rely on any 3rd party for core components. . . . He also says he doesn’t care a damn about the contract because he wasn’t involved, and we should just lie to [Symantec] that we are doing this for performance reasons[.]

Also, because the Court found that whether or not Microsoft’s actions were within the scope of the Agreement is a fact question that remains for the jury, it maintained Symantec’s copyright infringement claim – finding substantial similarity in Microsoft’s software. Accordingly, Symantec’s remaining claims will now proceed to trial.