ResMan wins $152m after COVID-19 mistrial

A Texas jury has awarded $152 million to US software company ResMan, after one of its clients was found liable for misappropriation of trade secrets to develop a rival product.

ResMan, which develops property management software, sued former customer Karya over claims it used ResMan’s proprietary software to develop its own rival product.

Karya worked with Texas-based software developer Expedien to produce Arya, a rival to ResMan’s software, and allowed Expedien to access ResMan’s systems more than 1,000 times without permission, ResMan claimed.

A jury at the US District Court for the Western District of Texas found in ResMan’s favour, concluding that Karya breached its subscription to ResMan by providing Expedien with access to the software. Both Expedien and Karya were found to have improperly acquired and used ResMan’s trade secrets.

The jury subsequently awarded ResMan $32.29 million in compensatory damages and $120 million in punitive damages. ResMan said it would seek injunctive relief and attorneys’ fees, following the verdict.

The case had originally been set to conclude last year, but was hit by a mistrial when 15 trial participants, including jurors and court staff, developed COVID-19.

“We are grateful for the jury’s verdict and appreciate the hard work of our trial team under very difficult circumstances,” said Paul Bridgewater, ResMan CEO, adding: “This case is very important to ResMan because our IP is one of our most valuable assets.”

Maria Wyckoff Boyce, partner at Hogan Lovells in Houston, led ResMan’s trial team. “This hard-fought case tried in the middle of the pandemic involved important issues surrounding the unauthorized use of computer software to develop a rival product,” Wyckoff Boyce said.

“The jury’s verdict for ResMan provides important relief for our client and its hard-working employees, who spent years and many millions of dollars developing this groundbreaking proprietary software used to manage apartment buildings throughout the US,” she added.

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