Earlier this week, Qualia filed an Amended Complaint in its ongoing IP lawsuit against Land Title Guarantee and Settlor. The Amended Complaint adds RICO and Computer Fraud and Abuse claims based on defendants’ recently produced documents, emails and texts.
Qualia welcomes fair competition. This is the only lawsuit Qualia has ever filed, and we did so because the evidence, a small fraction of which is directly quoted in the Amended Complaint, demonstrates that the named Defendants have engaged in unlawful conduct. We believe it is important for the industry to understand the extent of the allegations and evidence set forth in the Amended Complaint.
Rather than invest the time, money and resources to develop its own product to compete fairly with Qualia, the Amended Complaint details how the well-capitalized Land Title Guarantee and its alter ego, Settlor, through their senior executives, directed a multi-pronged ongoing RICO enterprise designed to systematically steal Qualia’s confidential information and trade secrets. Their scheme included:
- Insider Theft: Stealing proprietary and trade secret data from Qualia and sharing it with Settlor/Land Title Guarantee.
- Unauthorized Hacking: Fraudulently and secretly obtaining credentials for Resware in order to gain access to Resware’s confidential, protected functionality and use this Qualia information to illegally compete.
- Unauthorized Export: Writing and deploying scripts to extract specific trade secret data and confidential information.
- Targeted Recruitment: Identifying and poaching key Qualia employees specifically for their insider knowledge of Qualia’s Resware software and trade secrets.
The Amended Complaint further alleges:
- Within hours of receiving an evidence preservation request from Qualia, one defendant deleted hundreds of stolen Qualia documents from their own devices and Land Title Guarantee / Settlor systems and servers.
- In text messages they asked themselves, “how do I do it and stay away from the whole stealing IP thing?”
- One defendant asked his co-defendant and Settlor Co-Founder whether he could use stolen Resware administrative credentials to “pull anything we can get our hands on,” out of Resware, and was instructed to “pull away.”
Defendants, who never had authorized access to Resware and instead chose to use illegal means to hack into Resware, created and ran scripts designed to extract valuable and confidential business data and business logic contained in Resware, including the relational architecture within database tables; database table IDs; how database tables catalog and associate templates and documents; and triggers, business rules, settings, access control, templates, functions, queries and related functionality.
This was not an isolated incident of trade secret theft by a single bad actor. The Amended Complaint sets forth how it was a coordinated plan, crafted and carried out over two years by the defendants to steal Qualia’s IP and customers and harm its business.
Qualia is seeking damages for the harm caused by these alleged actions and injunctive relief to prevent further misuse of its trade secrets.
Click here to read the Amended Complaint.
