Appian awarded $2bn in damages in trade secrets lawsuit

Low-code software firm Appian has been awarded $2 billion in damages from customer relationship management (CRM) solutions provider Pegasystems following a lawsuit over alleged trade secret misappropriation.

Pegasystems says it “strongly disagrees” with the verdict

Appian says a jury in Fairfax County, Virginia – the home state of Appian – found that Pegasystems violated the Virginia Computer Crimes Act and that Pegasystems’ misappropriation of Appian’s trade secrets was “wilful and malicious”.

At the conclusion of the seven-week trial, the jury awarded Appian $2.036 billion in damages, which Appian believes is the largest award in Virginia state court history.

Appian CEO Matthew Calkins says: “Appian will never hesitate to defend itself and its intellectual property from competitors where it believes they have acted illegally.”

Appian alleges Pegasystems hired an employee of a government contractor to gain access to its software in a scheme known internally as ‘Project Crush’.

The firm says this contractor then allegedly passed trade secret information to Pegasystems, enabling its employees to build competitive features and train its sales team to better compete against Appian.

Appian also presented evidence that Pegasystems employees used false identities to obtain access to information and trial versions of Appian’s software.

The jury’s verdict and the court’s entry of judgement is subject to appeal by Pegasystems. Pegasystems is not required to pay Appian the amount awarded by the jury until all appeals are exhausted and the judgement is final.

Pegasystems has since responded saying it “strongly disagrees with the claims and the recent verdict, which are not supported by the facts of the case or the law and are the result of significant error”.

The company adds: “We have strong grounds to overturn this result, and we are actively pursuing all legal options. As a reminder, the appeals process could potentially take years to complete, and no judgement would be payable until this process has ended.

“This verdict has no impact on our products or what we are able to sell and service.”