CA Inc., a software company in Islandia, has filed a $200 million lawsuit against rival Rocket Software of Newton, MA, alleging Rocket stole computer source codes and other trade secrets from CA and used the information to develop almost identical products.
The lawsuit, filed in U.S. District Court in Central Islip, alleges that in 2000, Rocket hired four programmers and software developers who formerly worked for a CA subsidiary, Platinum Technology International. Before leaving Platinum, the lawsuit alleges, the engineers downloaded source codes for CA products onto laptops and discs, which Rocket used to develop its own software.
CA began to suspect foul play in 2001, when Rocket launched a series of database software products similar to CA’s. In 2004, CA says it received an anonymous letter—claiming to be from a Rocket employee—that confirmed the theft.
Final tip: This case is a powerful reminder that you need solid noncompete and trade-secret agreements for key personnel. Not only do such agreements discourage employee poaching, but they give you solid ground to sue if employees breach the terms.