Introduction

Australian tech firm Cocoon Data has filed a statement in the Supreme Court of New South Wales claiming that Macquarie Telecom allegedly copied one of its products. It further claimed that Macquarie Telecom misled government customers by providing wrong information about product upgrades which could have potentially made agencies more prone and vulnerable to online attacks. Macquarie Telecom has denied the claims filed by Cocoon Data.

Cocoon Data’s claim against Macquarie Telecom

The product Macquarie Telecom allegedly copied from Cocoon Data is Safe Share, a software that enables users to share files through a cloud-based encrypted platform. Cocoon Data filed the claim on September 22nd 2020 and Macquarie Telecom has 28 days from the date of filing to respond to the same. Failing to file a defence within the time provided, court will announce a judgement without a further notice.

Macquarie and Cocoon entered a contract in 2015 that allowed the first to sell Safe Share, under the name SigBox, to government agencies. At that time, Cocoon Data was known as Covata and the agreement signed didn’t prevent Cocoon from selling the product to clients that were not in the portfolio of Macquarie. 

The deal signed by the two parties included the following conditions: 

  1. Macquarie Telecom was not allowed to copy any part of the product, Safe Share Technology
  2. It could not modify, adapt or tamper with the Safe Share Technology in any way
  3. Macquarie cannot alter, remove or hide any trademark, copyright or other notice on or forming part of the product
  4. It cannot create any sort of derivative works from or translate the the product

The publically available statement filed by Cocoon says Macquarie Telecom violated the resell terms of the deal of Safe Share and created a duplicate version of the product which it said was an incremental upgrade.

Trent Telford, Cocoon Data Chief Executive said there are several reasons they’ve decided to pursue this action. The claims filed in the NSW Supreme Court articulate clearly the allegations made against Macquarie in detail, however, he adds, on a primary level, Cocoon believes Macquarie failed to encourage its customers to upgrade to the latest versions of Cocoon’s product. Telford further adds that Macquarie took a strategic decision to swap out Cocoon’s product for something Macquarie created and passed it on as merely a Sigbox Version 2.

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Macquarie’s response to the claims

A spokesperson from Macquarie Telecom says the company denied the alleged claims made by Cocoon Data Pvt. Ltd., a former vendor. The assertions and claims are without merit and they will file a defence in the proceedings shortly, said the spokesperson. 

Macquarie Telecom has not built a competing product, instead, it is reselling an “alternative product from another vendor” which relates to a minor file storage product. 

In contrast to the alleged claim, Managing Director of Macquarie Telecom Aidan Tudehope didn’t meet the sole Director and the sole shareholder of Cocoon Data Trent Telford in 2019. As it is a matter that’s now before the courts, the spokesperson concluded by saying they would be making no further comment at this point of time.

Conclusion

Cocoon Data has filed a legal claim against Macquarie Telecom, accusing the company of copying its Safe Share product and misleading government customers about product upgrades. Cocoon alleges that Macquarie violated the terms of their contract and created a duplicate version of Safe Share under the name SigBox Version 2. In response, Macquarie Telecom denies these claims, stating that it has not created a competing product but rather resold an alternative file storage solution. The case is ongoing, and Macquarie has yet to file a defense, with the court set to issue a judgment if the company fails to respond within 28 days.

FAQs

1. What is the lawsuit about?
Cocoon Data is suing Macquarie Telecom for allegedly copying its Safe Share product and misinforming government clients about product upgrades, which may have made them vulnerable to online attacks.

2. What product is at the center of the dispute?
The dispute centers around Safe Share, a cloud-based encrypted file-sharing software developed by Cocoon Data, which Macquarie Telecom is accused of copying and reselling under the name SigBox.

3. What did the contract between Cocoon Data and Macquarie Telecom include?
The contract stated that Macquarie could not copy, modify, or create derivative works from Safe Share, and it could not alter any trademarks or copyright notices.

4. What is Macquarie Telecom’s response to the claims?
Macquarie Telecom denies the allegations, stating they did not create a competing product but instead resold an alternative file storage solution. They also claim the assertions are without merit.

5. What could happen next?
Macquarie Telecom has 28 days to file a defense. If they fail to do so, the court will issue a judgment without further notice.

6. Why did Cocoon Data decide to file the lawsuit?
Cocoon Data believes that Macquarie Telecom failed to promote its product upgrades to customers and strategically swapped out Safe Share with its own product, passing it off as a simple upgrade.