Verity Sues Lotus Over Licensing Agreement

Verity Inc. sued Lotus Development Corp., now a unit of IBM Corp., charging that Lotus misappropriated trade secrets under a 1992 computer software licensing agreement. At the same time, it said it was terminating the agreement because of Lotus’ actions. Sunnyvale-based Verity develops and markets software tools for searching and retrieving information on computer databases and the Internet. Cambridge, Mass.-based Lotus sells business software, including the popular Lotus Notes program, in more than 65 countries. In 1992, Lotus obtained a license “to use some portions” of Verity software in its Lotus Notes product that helps users send and receive e-mail, according to the lawsuit filed in U.S. District Court in Wilmington, Del. Now Lotus threatens to violate the licensing agreement by using the unlicensed portions of Verity’s program “for its own purposes,” Verity’s lawyers said in the suit, which asks a judge for an injunction ordering Lotus to stop using the unlicensed material and pay for lost sales due to the alleged infringement. Lotus officials declined to comment. Verity shares rose $1.69 to close at $6.88 on Nasdaq; IBM shares rose $1.63 to close at $99.13 on the NYSE.