Judge Dismisses Aspects of Accenture’s Suit Against Guidewire and Guidewire’s Counterclaims

Through an opinion written by Judge Sue L. Robinson, the Delaware U.S. District Court has dismissed both Accenture's trade secret missapropriation charges against Guidewire Software, and Guidewire's countersuit alleging that Accenture's allegations constituted bad faith litigation that was harmful to Guidewire's prospects in the marketplace. While Judge Robinson's opinion puts an end to substantial aspects of Accenture's allegations of improper practices on the part of Guidewire, an Accenture source notes that the company's patent infringement case is "alive and well."

Last December Accenture alleged in a press release that Guidewire "willfully and maliciously obtained Accenture trade secrets without authorization." In Accenture's complaint to the court, Guidewire's alleged offenses related to the vendor's interaction with Chicago-based P&C carrier CNA, which in 2003 accepted a bid for Guidewire's claims solution at a price $10 million less than Accenture's bid for implementation of its Accenture Claim Components solution. Accenture questioned the plausibility of Guidewire being able to provide an acceptable solution to the carrier within the given timeframe. Guidewire, Accenture alleged, "seemed to have a surprisingly quick development trajectory, particularly in light of its small size and relatively light experience in the insurance market." Accenture inferred from that speedy trajectory that Guidewire "somehow gained access to Accenture trade secrets in creating its software and services."

In her opinion, Judge Robinson argued that Accenture's reasoning failed to meet a requirement to "plead certain facts" relative to its trade secret misappropriation claim; while Accenture's statement implied that Guidewire possessed Accenture trade secrets, it did not allege that Guidewire obtained the information by improper means, or even allege the nature of the means. Nor did Accenture's complaint allege specifically that Guidewire gained access to Accenture Claim Components through CNA. Said Judge Robinson:

"there is no allegation that Guidewire either disclosed or used the secrets in developing Guidewire Insurance Suite, only that Guidewire 'seemed to' develop its product 'surprisingly quick[ly]' in Accenture's opinion, which is of no import. Accenture is not entitled to conduct a fishing expedition based upon such bare allegations."

The opinion also concluded that there was no basis for charges that Guidewire improperly interfered with Accenture's relationship with CNA or that Guidewire engaged in unfair competition.

The failure of Guidewire's countersuit tracked closely to the speculative nature of Accenture's charges, in Judge Robinson's opinion. Guidewire based its claim that Accenture litigated in bad faith and competed unfairly on statements made by Accenture in its press release and in comments quoted in an Insurance & Technology article. However, argued Judge Robinson, "to the extent that [Accenture's] statements are viewed as statements of belief or opinion or conclusion, Guidewire fails to allege sufficient facts to make it plausible that Accenture did not truly hold those beliefs or opinions or reach those conclusions."

Guidewire also failed to plausibly argue that the public was misled by Accenture's statements, or that the statements were in fact "commercial speech" promoting the vendor's products, according to Judge Robinson's opinion.

With specific regard to Guidewire's charge that Accenture's suit amounted to unfair competition under the common law, Judge Robinson wrote, "Guidewire has failed to allege that Accenture's conduct affected the marketplace at all, let alone actually interfered with one of Guidewire's legitimate business expectancies."

While Judge Robinson's opinion puts an end to substantial aspects of Accenture's allegations of improper practices on the part of Guidewire, an Accenture source notes that the company's patent infringement case is "alive and well."

Guidewire reiterated its position that Accenture should never have been granted its patent, but that Guidewire has not infringed the patent, whether it be valid or not. "We are also pleased to report that we recently asked the U.S. Patent Office to re-examine the patent, and they have agreed to do so in light of our request," says Brian Desmond, Guidewire's vice president of marketing.

Editor's Note: An earlier version of this story erroneously reported that Accenture's patent infringement suit against Guidewire had been dismissed. In fact, the opinion memorandum of the Delaware U.S. District Court only accepted Guidewire's motion to dismiss Accenture's state law claims and trade secret misappropriation claims, and Accenture's motion to dismiss Guidewire's "bad faith litigation" counterclaims.

Anthony O'Donnell has covered technology in the insurance industry since 2000, when he joined the editorial staff of Insurance & Technology. As an editor and reporter for I&T and the InformationWeek Financial Services of TechWeb he has written on all areas of information ... View Full Bio