The lawsuit, filed against LzLabs, its two UK subsidiaries, and Moores, alleged that LzLabs’ UK-based subsidiary, Winsopia, breached the terms of its IBM software license. According to IBM, Winsopia purchased an IBM mainframe computer in 2013 and agreed to a licensing deal, which it later used to reverse-engineer IBM’s proprietary software.
LzLabs and Moores contested the claims, arguing that the company had independently developed its software over nearly a decade and did not unlawfully use IBM’s licensed technology. However, Judge Finola O’Farrell ruled largely in IBM’s favor, stating that Winsopia had breached its IBM software license and that LzLabs and Moores had “unlawfully procured” those breaches.
In a written ruling, Judge O’Farrell emphasized the significance of IBM’s intellectual property, which the company described as representing “billions of dollars of investment.” An IBM spokesperson expressed satisfaction with the verdict, highlighting the importance of protecting its technological innovations.
The ruling follows a trial held last year to determine liability, with a separate hearing to assess damages scheduled for a later date. However, the court dismissed IBM’s claims against another LzLabs subsidiary, LzLabs Limited, as well as its current and former CEOs.
LzLabs and John Moores, who previously owned Major League Baseball’s San Diego Padres and founded BMC Software in 1980, did not immediately respond to requests for comment.
The case underscores the ongoing challenges tech companies face in safeguarding their intellectual property in an increasingly competitive and innovative industry. For IBM, the ruling represents a significant victory in its efforts to protect its proprietary technology and investments.