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        home > news > Automobiles > Ford Sued for $1 Bil by Software Supplier

        Ford Sued for $1 Bil by Software Supplier

        Versata claims automaker stole trade secrets.

        Michael Strong
        Michael Strong , Managing Editor
        July 16, 2015
        Ford is being sued for $1 billion by a supplier that claims the company used its trade secrets to produce a rival software program.

        Ford Motor Co. is being sued by a former software supplier for $1 billion that claims the automaker stole trade secrets for product development software.

        Versata Inc., a Texas-based software development company, claims in its suit that Ford used proprietary information from the supplier in programs it patented. The company filed the suit on May 7 in Texas.

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        Ford is denying Versata’s claims and, in fact, filed an earlier lawsuit in Michigan to ensure that its program did not infringe on Versata’s intellectual property. Versata provides similar software to other automakers including General Motors, Nissan, Fiat Chrysler, Toyota, Hyundai, Kia, Volvo and Jaguar.

        The supplier claims it discovered the issue in February after contract negotiations last December fell apart. Reports the Detroit Free Press, the two sides were engaged in contract negotiations over ongoing use of the software. Versata asked for double-digit increases for using it and Ford, which wanted to maintain the price at its then-current level of $8.45 million annually, declined.

        (Ford plans to build new Continental alongside Mustang, Fusion. For more, Click Here.)

        Ford says it planned to discontinue using the Versata product at the end of 2014 because it had developed its own software: a program Versata officials claim Ford reverse engineered in order produce its version. Allegedly some of Versata’s protected trade secrets are included in Ford’s patents, according to the company.

        “We believe we’ve identified at least three areas where our trade secrets were copied into their patent, and I think we will find more,” Michael Richards, president of the global automotive division of Trilogy, Versata’s parent company, told the Free Press.

        (Click Here for details about Ford’s Apollo Edition Mustang to be auctioned for charity.)

        The automaker claims the Versata lawsuit was retaliation for Ford filing its lawsuit, the paper reported.

        “Versata’s Texas case is a retaliatory attempt to avoid the lawsuit in Michigan, where Ford’s software was developed and used. Ford will move to dismiss or transfer the Texas case to Michigan.”

        (Hyundai thinks its figured out why its sales are lagging: crossovers. Click Here for the story.)

        The Ford said/Versata said case likely won’t see a courtroom anytime soon. In fact, the first major hurdle to clear is where it will be heard: Michigan or Texas. An actual trial won’t likely occur for at least a year, according to Versata officials.

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        One response to “Ford Sued for $1 Bil by Software Supplier”

        1. Jorge says:
          July 16, 2015 at 3:17 pm

          Big companies often steal copyright or patent protected art and then end up paying a token price for the rights after a protracted lawsuit if they are able to drag the process out so it becomes very expensive for the plaintiffs to continue.

          Intel corp. did a deal like this to AMD when it was documented that Intel violated numerous anti-trust laws. The damages to AMD were probably at least $50-$100 billion and AMD eventually settled for less than two billion because they were cash poor and could see Intel dragging the litigation on for many more years. That’s how things work in the U.S. – unfortunately. It was a costly mistake for AMD who should have received at least $50 billion in compensation for damages.

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