A small Sydney technology company will face off against fast food giant Domino’s Pizza Enterprises in the Federal Court next month in what has been dubbed the intellectual property case of the decade.
Domino’s launched legal action against technology company Precision Tracking in April 2016 after abandoning a three-year project to install Precision’s GPS-based driver tracking technology and entering into an agreement with Navman Wireless.
Domino’s is challenging Precision Tracking’s patent and alleging breach of confidentiality, while Precision Tracking launched a cross claim in June 2016, claiming infringement of patents and breach of confidentiality.
Precision Tracking has alleged that Domino’s “reverse engineered” its technology and shared it with Navman, which developed a GPS system Precision claims is almost a replica of its own system. Domino’s has claimed that Precision Tracking’s technology differs from its own GPS driver tracker and the relationship came to an end after Precision could not reach agreement for the next phase of development.
Earlier this month, Domino’s lost its opening salvo in the case, when Federal Court judge John Griffiths ordered the pizza company to destroy privileged documents, including hand-written notebooks, which had inadvertently been handed over by Precision’s legal team during discovery.
Handing down his judgement, Justice Griffiths criticised Domino’s and its legal team for adopting and pursuing a “belligerent” and “unforgiving” approach rather than “politely and promptly” returning or destroying the material as requested.
“This conduct is notably more regrettable than the conduct of Precision’s solicitors – it displays very poor judgement,” Justice Griffiths said.
“I doubt that in earlier times, when there was greater professional courtesy between legal practitioners, this matter would have resulted in the response displayed by Domino’s and its legal team.”
Domino’s was ordered to pay Precision’s cost, adding to a mounting legal bill for all parties including Navman Wireless Australia, which has also launched a counter claim.
Over the last month, Domino’s and Precision Tracking have filed more than a dozen affidavits in support of their claims ahead of a 15-day hearing before Justice Alan Robertson on November 27.
In March, Justice Robertson ordered Precision to pay $500,000 in “security of costs” payments, which are common in IP cases to ensure successful parties can recover costs.
Domino’s shares have fallen as much as 37 per cent this year after the franchisor missed sales and profit growth forecasts and announced a $300 million share buyback.
Precision Tracking founder and director Vlad Lasky said the company was still a going concern and was looking forward to having its day in court.
“It’s been time-consuming but we are committed to our cause – protecting our IP, protecting our technology, ensuring that justice is done for our company,” Mr Lasky said.
“We think this is an important case in IP in Australia given that IP has become far more prominent in recent years. It will be keenly watched by a lot of innovators big and small to get guidance on how the law will work to help them in the future.”
Earlier this year, a similar case in the US between Domino’s Pizza Inc and Prostar Wireless Group was dismissed.
Prostar had sued Domino’s Pizza Inc for $US115 million in damages, alleging the pizza chain encouraged Prostar to develop a custom navigational software tool and promised to allow it to roll out the tool to franchise owners worldwide.
Prostar alleged it had collaborated with Domino’s over 10 years but, after pulling the plug, Domino’s refused to compensate the company for its work and developed its own GPS tracking system, which Prostar alleged was functionally identical to Prostar’s.
The US District Court found that Prostar had not plausibly established what its agreement with Domino’s was, whether it had an ongoing relationship with franchisees that was interfered with, or how it protected its trade secrets. Domino’s motion to dismiss the case was granted and Prostar’s complaint was dismissed. Prostar is believed to have appealed.
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