Telecommunications software and hardware solutions provider Technical Information Systems (TIS) is preparing to launch a R122 million lawsuit against fixed-line operator Telkom and Marconi Communications.
This comes after Telkom and Marconi were last year found guilty of copyright infringement, stemming from a complaint that TIS's internally-developed software had been changed and distributed online by Telkom.
TIS had an agreement in place with Marconi that allowed the telecoms company to supply a telephone management system, Man3 000, to Telkom, which then supplied it to end-users. However, the agreement ended in March 2005 and was not renewed.
The system, sold under the name Teltrace Soho System, has a software interface component and a hardware component - known as a buffer box - that interfaces with a company's PABX system to collect data.
Withdrawal of appeal
This morning, TIS director Tim Hammerich explained that Telkom had issued a notice that it would withdraw its appeal against the ruling in March last year, without giving reasons.
Despite this, Telkom continues to offer the Teltrace Soho System product for download via its Web site.
"We are preparing to file an urgent application against Telkom and Marconi for contempt of court and we will also be proceeding with a damages suit against them."
Hammerich says the damages claim for copyright infringement will amount to R95 million and TIS will seek a further R2.4 million for the continued distribution of the software outside of the agreement. He says the company will also seek R24 million for the publication of confidential documentation during the initial court case.
This morning, the parties were scheduled to appear in court over TIS's legal fees, as Telkom and Marconi "served a notice of withdrawal [of their appeal], but with a limited tender of costs, namely 'party and party costs for the heads of agreement and wasted costs (if any) to date'."
TIS claims that: "It is quite clear that the tender of costs is irregular, as it does not include, for example, the counsels' reserved first day fee and does not cover the costs of two counsel."
The outstanding legal fees, says Hammerich, run into a "couple of million".
TIS's initial copyright infringement suit came after it discovered, in February 2006, that parts of its software had been rewritten and the rebranded update had been made available for download on Telkom's Web site.
Unlawful changes
The updates were made available after Marconi indicated it would not renew the contract with TIS, and was not interested in further updates from TIS. Marconi, however, continued to purchase buffer boxes on an ad hoc basis.
TIS said in court papers that Marconi rewrote aspects of the software, removing the licence agreement, its warranty, changing the installation wizard and all information relating to TIS and the update reminders.
In March 2006, TIS informed Marconi and Telkom this was unlawful and demanded the companies cease their conduct. TIS then looked at Telkom's Web site and discovered that, despite the program being removed, it was still displayed by the HTML source code.
In March last year, the Witwatersrand High Court ruled that Telkom and Marconi stop infringing copyright, and not reverse-engineer, or directly or indirectly distribute the software. It also ordered costs in TIS's favour.
Telkom could not comment by the time of publication, while Marconi could not be reached for comment this morning.
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