A patent and copyright squabble involving two players in the networking space for information technology (IT) development, which has ramped up in recent years, saw an interesting round of events play out in federal court and regulatory agencies this past December. At the center of the brouhaha is American networking and telecommunications giant Cisco Systems (NASDAQ:CSCO) of San Jose, CA, which has filed multiple legal actions against Arista Networks (NYSE:ANET) of Santa Clara, CA, alleging that Arista has moved into the networking equipment market using technologies developed and patented by Cisco, specifically through former Cisco employees who founded Arista.
Cisco’s patent infringement allegations are outlined in a patent infringement complaint filed in December 2014 in the U.S. District Court for the Northern District of California (N.D. Cal.). While Cisco executives have “written and spoken in support of employee mobility,” according to the complaint, it still feels that actions by its former employees are unlawful in this case. Instead of developing its own technologies, Arista allegedly copied Cisco’s proprietary technologies to compete against Cisco in the same market.
In the N.D. Cal. patent infringement suit, Cisco asserted a total of 12 patents, including:
- U.S. Patent No. 6377577, entitled Access Control List Processing in Hardware. It claims a method for processing access control lists in a way that improves routing speed.
- U.S. Patent No. 7023853, same title as ‘577 patent. It protects a similar system for hardware processing of access control lists which improves routing speed over conventional software management solutions.
- U.S. Patent No. 7340597, titled Method and Apparatus for Securing a Communications Device Using a Logging Module. It discloses an apparatus having a logging module for a communication device which improves system security without unrealistic hardware demands.
- U.S. Patent No. 7162537, titled Method and System for Externally Managing Router Configuration Data in Conjunction with a Centralized Database. It claims a method for reducing computational overhead in a centralized database system which allows subsystems of internetwork operating systems providing command functions to routing devices to be modular and independent.
Around the same time, Cisco also filed a copyright infringement suit against Arista, also in N.D. Cal. This suit targets the use of 500 multi-word commands which Arista allegedly copied verbatim from Cisco’s command-line interface. The copyright suit also includes allegations that Arista copied material from Cisco’s user manuals to create its own manuals, including the inclusion of several typos from Cisco’s manual materials. Cisco argues that the infringement of both copyrights and patents held by Cisco show that Arista is unwilling to engage in its own research and development in order to compete. The separate copyright infringement case also includes the assertion of two U.S. patents held by Cisco:
- U.S. Patent No. 7047526, titled Generic Command Interface for Multiple Executable Routines. It protects a method in a processor-based system to validate, with a parser, generic commands received from a user which integrates multiple real time monitoring programs, reducing the technical expertise necessary to utilize various command formats and syntax.
- U.S. Patent No. 7953886, titled Method and System of Receiving and Translating CLI Command Data Within a Routing System. It claims a data processing method which provides a simplified structure for sending instructions to, and receiving data from, routers in an interwork operating system command-line interface.
On top of these separate actions in N.D. Cal., Cisco filed a Section 337 complaint with the U.S. International Trade Commission (ITC) to further oppose the importation of Arista’s patent-infringing network devices into the U.S. market. Section 337 investigations are conducted when one party alleges that another party’s products infringe upon patents, often pursued to seek an exclusion order keeping infringing products out of the U.S. market. ITC decided to institute the investigation into Arista’s devices in January 2015.
Through the first half of 2016, a couple of rulings coming out of the ITC gave a couple of important early victories to Cisco. In early February, an ITC ruling found that Arista did infringe upon Cisco’s patents through the sale of networking equipment for private virtual local area networks (VLAN), system database and using a centralized database to externally manage router configuration data. Another ruling issued by the ITC this June found that Arista’s products infringed upon a series of five Cisco patents and ITC’s determination included a recommendation that Arista’s products be excluded from the U.S. market. In August, the U.S. Trade Representative began the import ban and served Arista with a cease and desist order based upon ITC’s recommendation.
A succession of decisions in December paint a somewhat convoluted picture as to the current status of Cisco’s case against Arista. At the ITC, Cisco scored a third win on December 9th when an initial determination was filed by the case’s administrative law judge (ALJ). The initial determination found that Arista’s products infringed upon a pair of Cisco patents, including the ‘577 patent. However, the ITC’s ALJ determination comes a few weeks after U.S. Customs and Border Protection gave permission to Arista to import networking gear containing a new technological workaround, overturning the ban on Arista’s importation practices brought on by ITC’s earlier rulings.
In N.D. Cal., however, Arista is having much better success. In mid-December, a federal jury returned a verdict rejecting a $335 million damages award in the copyright infringement action which would have been given to Cisco. According to The Wall Street Journal, although the jury did find that Arista copied commands from Cisco’s command-line interface, the jury accepted a scènes à faire defense in which Arista argued that its actions in copying Cisco was legally permissible because of Arista’s need for hardware technical compatibility with Cisco’s industry standard commands. A blog post written by Cisco’s general counsel expressed dissatisfaction with the ruling, especially over the court’s application of the legal doctrine which rendered Arista’s actions permissible. “We believe they misapplied, or misunderstood, this narrow doctrine developed to make sure copyright infringement does not extend to commonplace elements from literary works such as plot device, a character or a setting,” wrote Mark Chandler, senior vice president and general counsel for Cisco.