Corrs Chambers Westgarth has successfully advised financial technology developer Zomojo Pty Ltd in a landmark intellectual property matter against its former co-managing director and head of Research & Development, Matthew Hurd.
The Federal Court of Australia delivered an emphatic judgement in favour of Zomojo. The Court found that Mr Hurd had breached his legal and ethical obligations by taking and using Zomojo’s sophisticated high speed market trading technology and confidential information, which he then used to establish competing products under the brand “Zeptonics”, with funds invested by third parties.
Australian-owned Zomojo invested significant resources in developing sophisticated high speed proprietary trading devices and technologies for the equity and derivatives markets. With trading speeds of less than 10 microseconds, Zomojo’s devices rank among the fastest in the world.
“This is global market-leading technology,” said Corrs Partner Janet Whiting, who led the case against Hurd. “It’s a warning for investors to do their due diligence on claims of IP ownership.”
Third parties invested in Mr Hurd’s business which was substantially about exploiting Zomojo’s intellectual property. Zomojo will now actively seek the return of all of its trading devices. Zeptonics’ clients who have been operating the Zomojo owned technology will need to remove the relevant hardware and return it.
“While this will cause inconvenience to these parties, it is the unfortunate unavoidable consequence of Mr Hurd and Zeptonics selling technology they did not own,” said Ms Whiting.
The court described Mr Hurd’s conduct as ‘dishonest’, ‘reprehensible’, and nothing more than ‘a flagrant and deplorable attempt’ to obtain benefits for himself which belonged to Zomojo. The Court found that Zeptonics’ trading devices known as the ‘OptiCast’, ‘ZeptoCast’, ‘ZeptoLink’, ‘ZeptoNIC’, 'ZeptoAccess KRX’ and ‘Crosswise ATS’ are rightfully the property of Zomojo.
The Court ordered Mr Hurd and Zeptonics to cease all use of the trading devices, return them to Zomojo and pay damages.
The amount of damages will be determined by the Court in a hearing commencing in July 2013.
“The language in the judgement is unequivocal,” said Matthew Critchley, Corrs Senior Associate.
“The IP is owned by Zomojo. It was taken, used unlawfully and orders have been made to restore it to its rightful owners.” said Mr Critchley.
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