IBM will face off against LzLabs today in the High Court after the software giant accused the Swiss startup of illegally reverse-engineering its mainframe technology. Big Blue alleges that LzLabs has been using IBM software it originally licensed by a subsidiary named Winsopia to create a product capable of transferring IBM mainframe users onto open-source alternatives. Mrs Justice O’Farrell will hear IBM’s claim over the next month.
LzLabs declined to respond to Tech Monitor’s request for comment. According to a document shared with this publication sketching out its defence, however, it is understood that the startup will argue in court that IBM is attempting to suppress competition to its mainframe product with its suit (a claim the latter denies.)
“Without this action, IBM and IBM Corp faced the dilemma of witnessing the departure of their customers who had, until now, been locked into IBM’s legacy mainframe environment, or having to make very significant concessions on pricing and/or other terms,” said the document. “Instead, they have decided upon a scorched earth litigation strategy, leaving no stone unturned in their attempt to identify any conceivable basis for a claim against Winsopia and LzLabs.”
LzLabs claims SDM product ‘protected’ by UK and EU law
Central to IBM’s allegations is a LzLabs product it calls its Software Defined Mainframe (SDM.) Using SDM, companies can port their IBM mainframes over to open-source alternatives. This has included Swisscom, which migrated its 2,500 MIPS mainframe running on 8 virtual cores of x86 compute power using the service and resulting, LzLabs claims on its website, in a 70% saving on its annual recurring core software license and a 50-60% reduction in its total IT cost.
For its part, LzLabs claims that its use of SDM is protected by UK and EU law and that the product was created from a decade’s worth of its own research. In its original filing, meanwhile, IBM alleges that the Swiss startup used Winsopia to acquire an IBM mainframe, license its software and then copy parts of it to build SDM in a clear breach of copyright. According to its original filing, IBM is seeking a declaration that Winsopia’s license has been terminated, an injunction preventing the subsidiary from using any IBM mainframe software or connected services relying on SDM, and damages.
IBM rejects anti-competition argument
When approached by Tech Monitor for comment, IBM rejected any argument that its case against LzLabs was an attempt to suppress marketplace competition with its mainframe products. Rather, said the former, what is at issue “is the unlawful exploitation of technology that represents billions of dollars of investment, and IBM UK will vigorously protect itself against the actions of Winsopia and LzLabs.”
It’s not the first time IBM has mounted legal challenges to defend its copyright. In 2022, the firm sued Micro Focus in the US, claiming that the UK firm had copied code from its CICS Transaction Server software in an act of “illegal opportunism, wilful infringement, and blatant breach” of its contractual obligations. At the time, Micro Focus labelled the accusation as “baseless” and “without merit.” That lawsuit is ongoing, with a US judge ruling last month that IBM was entitled to pursue discovery in relation to foreign sales made by Micro Focus accrued from the latter’s disputed products.
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