If you’re an NFL fan, this weekend featured a rematch of an earlier game where the Patriots crushed the almighty Houston Texans. The result was much the same, with the Pats having their way with the inferior team from Texas. The Texans looked good on paper, but in the end, the better team won.
Similarly, last week, a San Jose-based federal judge confirmed a $60-million award in Brocade’s favor, which had been delivered on August 6, 2012. The judge also issued a permanent injunction barring the defendant, A10 Networks, from infringing on Brocade’s Global Server Load Balancing and High Availability patents. This means A10 is now forbidden from making, using, selling or offering to sell any of the products that use those patents in the U.S.
The judge also noted that a further $50 million in damages for lost profits under the patent claim might also be due to Brocade. There will be a new trial to determine the extent of the patent damages and decide on an appropriate amount.
I blogged about the initial award back in August (http://www.networkworld.com/community/blog/guilty-charged-a10-networks-feels-patent-blues) and was soundly flogged in the comments. Granted, the award right now is $60 million plus some portion of the other $50 million, and not $112 million, the fact remains that A10 was found guilty and will pay a handsome chunk of change to Brocade for the patent violations.
There should be no disruption to current A10 customers as the ruling allows current users of the AX series to continue to get support for any installed products. A10 is also claiming that all of the code that infringed on Brocade patents has been re-written, meaning, in theory, there should be little to no disruption to the current business. When I first read this, I was very surprised that A10 could have created workarounds for the patent violations this quickly. I’ve asked a few other contacts from different companies (not Brocade) and they too were surprised and didn’t feel there was any way to have done this as quickly as A10 did.
If you read through the comments in my original blog, there are many (I’m assuming A10 employees) that claim the patent infringements were minor (by the way, stealing a little and stealing a lot is still stealing, as my mom used to tell me). I’m speculating that the A10 spin is that the violations were minor, so the fixes were as well. If they were, though, then why did a judge award such a large cash amount? Also, if they were minor, then why steal the code initially? I know there are always multiple versions of the truth and both sides provide a favorable view from their perspective, but the ruling seems to indicate Brocade’s version is the more accurate of the two. A10 is a private company, so it’s not obliged to provide quarterly numbers, which is too bad, since new product sales moving forward will be the biggest measure of the extent of the impact of the ruling. Either way, this should end this chapter for both companies, and customers can move on.
On a totally unrelated note, Brocade announced on Monday that it hired Lloyd Carney, most recently of Xsigo, to replace Mike Klakyo as CEO. Carney certainly has an impressive background, most recently as the head of Xsigo, which was acquired by Oracle for an impressive chunk of change. It looks like a good fit for Brocade that’s looking to take advantage of the current shift in the data center. It’s the beginning of a new chapter for Brocade, as well.