Compuware sues IBM over software code

Compuware Corp. Tuesday sued IBM Corp., claiming the industry giant has abused its mainframe market dominance and misappropriated some of its intellectual property.


its suit, filed at the U.S. District Court for the Eastern District of Michigan, Compuware alleges IBM illegally used code from copyrighted Compuware software products in IBM’s new File Manager and Fault Analyzer.

And in an argument reminiscent of antitrust allegations leveled at Microsoft Corp., Farmington Hills, Mich.-based Compuware also claims IBM, in conflict with the U.S. Sherman Antitrust Act, has illegally taken advantage of its market position by tying the purchase of mainframe software tools to those of “”critical”” IBM software products.

“”In both cases you have companies with a monopoly in basic systems software using it to gain advantage in another product (area),”” said David Ettinger, an antitrust and trade regulation attorney representing Compuware in the case. “”If you’re a customer and receive IBM’s debug tool as part of their full COBOL release whether you ask for it or not, you may not be inclined to ask what is the best product.””

Ettinger, a partner at Honigman Miller Schwartz and Cohn LLP in Detroit, noted however that the case against IBM is being heard in a different district than the federal Microsoft antitrust suit and that each case rests on its own evidence.

IBM spokesperson Joyce Lagas said the company is aware of the lawsuit but as a matter of corporate policy, does not comment on pending litigation.

Compuware, which provides debugging and fault diagnosis software for IBM mainframes and distributed networks, is accusing IBM of anti-competitive action for refusing to provide Compuware and other companies pre-release data and software that allows them to make their products more compatible with IBM products. Compuware says IBM gave this access to ISVs for years, until Armonk, N.Y.-based IBM began competing directly with them.

“”IBM is a monopolist. As such, the law says they have a duty to cooperate. Not cooperating would be anti-competitive. It’s in everybody’s interest for IBM to provide Compuware with information,”” Ettinger said, referring to mainframe players and consumers.

Compuware’s filing claims an e-mail from IBM to Compuware stated that “”due to increasingly competitive relationship with Compuware we cannot give you a beta version (of IBM COBOL Release). FYI: We just shipped ‘Fault Analyzer for OS/390’ and ‘File Manager for OS/390,’ direct competitors with Abend-Aid and File-Aid. We are working feverishly to make our Debug Tool better than Xpediter. Therefore, shipping a beta to you would be seen as helping the enemy, however untrue that may be.””

Whether or not IBM has been abusing its market position, there is little question about its dominance in the mainframe space.

“”IBM is the market,”” said Alan Freedman, IDC Canada Ltd. research director for services and storage. “”In terms of hardware, everyone else has exited that market.””

While he said IDC is predicting the growth of Unix will adversely affect the mainframe market, he said IBM is in a very enviable position.

“”The trend these days is of centralization and consolidation, people are looking back to a data centre environment, so that bodes well for the mainframe space,”” Freedman said.

Ettinger said it is also anti-competitive and unethical of IBM Global Services to steer clients towards IBM products rather than those of Compuware or other ISVs.

“”As a full-service outsourcer, they take over the complete IT organization,”” Ettinger said. “”They are holding themselves out as an objective source here and we’re alleging they’re not doing that.””

As for the allegations of intellectual property theft, Compuware alleges IBM copied portions of Compuware manuals verbatim for its own File Manager manual. As well, he said the allegations against theft of actual software code are quite solid, as IBM’s software contains the same bugs as Compuware’s software.

“”Given that these products have tens of thousands of computer statements, the idea that they would have the same mistakes . . . that can’t be coincidence.””

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