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The Court of Appeal held that Virginia fundamentally misread and misapply Supreme Court precedent Virginia Failure to adequately consider the trial judge’s evidentiary findings and Pegasystems’ trial misconduct
McLean, Virginia, July 30, 2024 PRNewswire/ — Appian (NASDAQ: Application Network) announced today that it will appeal the Court of Appeal’s decision. Virginia and seeks to restore a judgment against Pegasystems Inc. (“Pega”) for willful and malicious misappropriation of trade secrets. The jury’s verdict was based on seven weeks of testimony from dozens of witnesses and thousands of pages of documents that showed that Pegasystems hired a “spy” to analyze the inner workings of Appian software, improve its own products, and earn billions of dollars in revenue by misappropriating trade secrets.
Although Pega claimed that no “trade secrets” existed in this case, the appellate court clearly ruled that Appian had provided sufficient evidence of its trade secrets to the jury and that Appian had taken reasonable steps to protect those trade secrets. Virginia The jury also found that Pegasystems violated the Virginia Computer Crime Act, but Pegasystems declined to appeal the ruling, meaning that the judgment that Pegasystems violated the Virginia Computer Crime Act is confirmed and final.
The three-judge panel of the Court of Appeal ruled to remand the case to the trial court to rule on the exclusion of evidence and the burden of proof for damages once misappropriation is proven in trade secret cases. The court ruled that Pegasystems had all the evidence related to its own sales and therefore did not need to prove that its sales were unrelated to its illegal misappropriation, thus severing the case from the trial court. Virginia Unlike the rest of the country, which views trade secret protection, Pegasystems itself disingenuously argued in its trade secret litigation that this liability shifting was the proper way to address the damages issue.
Appian also argues that the appellate court reversed several of the trial court’s evidentiary decisions because the court failed to adequately consider the full record and the trial court’s discretion to try Pegasystems for serious misconduct within seven weeks. These decisions were well within the trial judge’s authority and, in several cases, were requested by Pega itself.
“We will appeal to the Supreme Court Virginia We will seek to reinstate the judgment and remain confident that the evidence of misappropriation and our rights to appropriate damages will be properly addressed. Virginia The court said Christopher WintersGeneral Counsel of Appian.
During the seven-week trial, Appian presented evidence that Pegasystems hired an employee of a government contractor to provide Pegasystems with access to Appian software as a way to learn how to better compete with Appian. In hiring the contractor, Pegasystems instructed its third-party contracting service to recruit an individual who was not “loyal” to Appian. Appian presented evidence that the contractor passed trade secret information to Pegasystems to enable its employees to build competitive features and train Pegasystems’ sales team to better compete with Appian. At one stage in the case, Alan TrefflerThe Pegasystems founder and CEO admitted that it was “inappropriate” for Pegasystems employees to hire the contractor and that the contractor “clearly did things he had no authority to do.”
The contractor, known internally as “the spy,” helped Pegasystems create dozens of video recordings of Appian’s development environment for Pegasystems to compile competitive materials and evaluate improvements to its platform. Appian also submitted evidence that Pegasystems’ product development team reviewed the materials provided by the contractor and changed the course of Pegasystems’ product engineering to take advantage of the Appian technology they saw. Appian’s expert witnesses testified that if Pegasystems had not misappropriated Appian’s trade secrets, Pegasystems’ software platform would have been obsolete.
If a new trial is ultimately ordered, Appian will seek the full amount of damages asserted at the original trial, which exceeds $3 billion.
About Appian
Appian is a software company that automates business processes. The Appian AI Process Platform includes everything you need to design, automate, and optimize the most complex processes from start to finish. The world’s most innovative organizations trust Appian to improve their workflows, unify data, and optimize operations to achieve better growth and exceptional customer experiences. For more information, visit appian.com.（NASDAQ: Application Network）
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Forward-Looking Statements
This press release contains forward-looking statements. All statements contained in this press release, other than statements of historical fact, are forward-looking statements, including statements regarding Appian’s ability to collect judgments and attorneys’ fees, the outcome of any appeal, and the timing of such matters. All aspects of the Court of Appeal’s decision are subject to further appeal by Appian or Pegasystems. Appian cannot predict the outcome of any appeal or the time required to resolve an appeal. Words such as “anticipate,” “believe,” “continue,” “estimate,” “expect,” “intend,” “may,” “will” and similar expressions are intended to identify forward-looking statements. These forward-looking statements are subject to a number of risks and uncertainties, including those set forth in the “Risk Factors” section of Appian’s Annual Report on Form 10-K for the year ended December 31, 2019. December 31, 2023 Filed with the U.S. Securities and Exchange Commission February 15, 2024 and other reports Appian files with the U.S. Securities and Exchange Commission. Except as otherwise required by law, Appian undertakes no obligation to update any forward-looking statements after the date of this press release to conform such statements to actual results or revised expectations.
Source: Appian
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