Yahoo Plays Lawsuit Game With MForma

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Seven former Yahoo engineers left the portal company to work for mobile games company MForma, and Yahoo has accused them of walking out the door with trade secrets.

Yahoo Plays Lawsuit Game With MForma
Yahoo Shows It’s Litigious Side

Yahoo lawyers filed suit on Monday against MForma, a publisher of mobile phone games. Mercury News quoted one of those lawyers, Yahoo associate general counsel Reggie Davis, on how negotiations between the two companies led to the courtroom:

“Extensive evidence of wholesale theft,” found at workstations and laptops, prompted the legal action, he said.

“This was not something we did lightly, and it’s not something we relish,” Davis said. “It was something we felt compelled to do in order to stop the theft and make sure our secrets were not misappropriated.”

Yahoo believes the problem began when one of its managers, David Chang, resigned from Yahoo last November. The company claimed that Chang made electronic copies of numerous internal documents before leaving Yahoo. Also, another Yahoo employee recruited by Chang likewise brought confidential information along from Yahoo.

MForma has denied those accusations,and characterized the lawsuit as a way to pressure its current employees to stay with Yahoo:

“When great talent shows up at our doorstep, we are eager to give them work at a great company,” (MForma President Jonathan Sacks) said. “We are not going to be intimidated in doing that by a giant company that chooses to sue to intimidate people if they want to leave.”

His company, he added, insisted to Yahoo that it was not interested in its intellectual secrets.

“We have been in discussions with them and done our best to show them they have nothing to be concerned about,” Sacks said. “We respect their, and everyone else’s, trade secrets. They have decided to go ahead and sue us anyway.”

Yahoo’s case draws heavily from instant messaging chats between the former employees. Archived chats found on laptops have been cited as evidence in the suit.

Yahoo wants the court to hand down an injunction against MForma to stop them from using Yahoo intellectual property. The suit also asks for unspecified damages.

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David Utter is a staff writer for WebProNews covering technology and business.

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