A Goliath versus David trial kicks off in London next week – where IBM is suing LzLabs. Big Blue claims that the Zurich-based company used a British subsidiary to reverse-engineer its mainframe software in order to assist LzLabs in developing its Software Defined Mainframe (SDM).
IBM has been fighting aggressively in the courts to protect its mainframe dominance; in 2022 suing the UK’s Micro Focus, for allegedly copying its software for competitive purposes. Micro Focus calls that claim “baseless”.
(In 2022, IBM was ordered to pay $1.6 billion to mainframe rival BMC after a separate Texas lawsuit that saw a judge ultimately describe IBM’s behaviour as “fraudulent and malicious". IBM is challenging the ruling.)
Using SDM, LzLabs has helped companies like telco Swisscom move its entire IBM mainframe workload of 2,500+ installed MIPS to a private cloud (featuring EMC/Cisco x86 hardware and VMware) without any data reformatting or recompilation of its application programme code.
LzLabs says that not only was the development the product of its own innovation, but that its development of the SDM to make programs built for a mainframe compatible with other platforms is protected by European and UK laws that promote innovation and competition.
IBM: You reverse engineered our software
In its High Court pleadings, IBM UK alleges that LzLabs used Winsopia, a UK-registered firm wholly-owned by LzLabs, to buy an IBM mainframe, licence the OS to run it and then reverse engineer parts of this software to help LzLabs to develop the SDM – which it says was in breach of contractual terms that prohibit the reverse engineering of IBM products.
As law firm Slaughter and May has put it “IBM did not like the fact that SDM effectively helped users to migrate off IBM’s hardware as it enabled applications which were designed to be used on IBM mainframes to be used on non-mainframe computers” – it is now suing in both the UK and US. (Lzlabs has unsuccessfully applied to the English courts interim anti-suit injunctions against both IBM UK and IBM Corp in relation to the US proceedings; IBM challenged that and won on a jurisdiction basis.)
LzLabs is expected to argue in part that the UK’s Copyright, Designs and Patents Act 1988 (CDPA) empowers potential competitors to analyse the functionality of a computer program with a view to developing an alternative product and also expressly prohibits licensing agreements from preventing such competitive activity – its use of the mainframe, it says, will be to study and test the ways that customer applications and interfaces within those applications interacted with IBM’s tin and that this was not in breach of Winsopia’s licensing agreement and perfectly lawful.
The Stack will have a reporter at court for the trial, which commences on April 29, 2024. (IBM’s Texas litigation is likely to start in Autumn 2024.)
Look out for regular updates from the trial on our homepage.
