Avant! Corp looks as if it may now have escaped from the black cloud of potentially huge damages that could have arisen from its long-standing dispute with Cadence Design Systems Inc. Late Wednesday, US District Court Judge Ronald M White ruled that Cadence’s trade secret claim based on the alleged use by Avant of the Cadence Design Framework II source code in its design automation products was barred by a Release signed by Cadence in 1994. The Release also bars all Cadence copyright claims up until 1994, but doesn’t cover Avant products developed after that date.
Avant’s general counsel David Stanley called the ruling a significant victory. Cadence is no longer eligible to receive punitive damages even if [Cadence] prevails on its remaining copyright claims. Last year, Cadence was publicly calculating that, if it were successful, Avant might be held financially liable for an amount over $1.5bn. It even professed itself worried that, if the infringements went on unchecked, Avant would not have sufficient resources to pay the damages.
The decision makes it likely that Cadence will win its copyright claim over Avant’s discontinued ArcCell product, Avant admitted, and increases the likelihood that it will also win its case over Aquarius – also discontinued. Both those products were developed after 1994. Avant says it has additional meritorious defenses ready in respect to Aquarius, however. The ruling will have no impact on its current Apollo product line, Avant said. A status conference with both companies is due to be held today (Friday) in San Jose to cover the remaining copyright issues.
Despite Avant’s optimism, the case is still moving towards trial, and separate criminal cases have been filed against CEO Gerald Hsu and seven others in the company. Avant was formed in 1991 by four engineers from Cadence. Cadence first filed suit in December 1995.
