The Washington State Court of Appeal (Division 1) has substantially affirmed a trial court judgment against Corbis Corporation for Fraud, Breach of Contract, Breach of the Duty of Good Faith and Fair Dealing, Misappropriation of Trade Secrets and Unjust Enrichment. The three-judge panel affirmed all but one claim stemming from the three-year legal battle over the ownership of Infoflows' Fedmark technology.
At trial, a 12-member jury found Corbis liable on eight different claims, including two claims of fraud, primarily arising from Corbis' secret and undisclosed filing of a patent application based in large part on Infoflows' technology and its fraudulently inducing Infoflows to enter into a software development agreement. The jury also found that Corbis misappropriated Infoflows' trade secrets, breached its contract obligations, and acted in bad faith.
After hiring Infoflows to perform development work and gaining exposure to Infoflows proprietary technology, Corbis improperly terminated its contract with Infoflows and then claimed ownership of significant portions of the Infoflows technology. The evidence presented to the jury concerning the involvement of senior Corbis executives and team members in the underlying conduct was extensive, and included back-channel meetings and communications, and the replication and distribution of Infoflows' documents.??
The jury initially awarded Infoflows over $36 million in damages, finding in favor of Infoflows on all claims. Following trial, the judge reduced the damage award and also issued a permanent injunction barring Corbis from claiming any ownership over Infoflows' Fedmark system and from developing any similar license management system that relies on Infoflows' trade secrets and proprietary Fedmark technology.
"We are pleased that the Court of Appeals saw this case for what it was - repugnant conduct by executives of Corbis who attempted to deceive Infoflows and misappropriate its intellectual property and then cover their actions," said Steve Stone, founder of Infoflows and one of the inventors of the Fedmark technology. "At this point we look forward to moving on from this dispute and continue building our business."
For more information about the case see (
http://www.infoflows.com/News/InfoflowsvCorbis.aspx).