On the Accenture/Guidewire Dismissal News

The latest news out of the Accenture/Guidewire case seemed to promise some kind of resolution, resulting in my early misinterpretation of the result. Others similarly expected something more substantial than what actually emerged. Alas, nothing much has been resolved by the opinion recently issued by the Delaware U.S. District Court, judging by my conversations with knowledgeable sources. But interesting questions remain.The substance of the opinion consisted in Judge Sue L. Robinson's acceptance of motions to dismiss from each of the parties to the case. Among the charges covered by the motions were Accenture's claim that Guidewire had misappropriated trade secrets and Guidewire's claim that Accenture had litigated in bad faith. The opinion by no means affected Accenture's claim that Guidewire infringed its patent related to Accenture Claim Components software. Nor did it even necessarily bar the door to Accenture resuscitating some of the claims dismissed, according to a patent attorney I consulted. Similarly, Guidewire could conceivably resurrect its counterclaims depending on how Accenture chose to reintroduce claims against Accenture.

In other words, Judge Robinson's decision sheds no light on whether or not Guidewire did in fact misappropriate Accenture's intellectual property, to say nothing of whether the company infringed Accenture's patent deliberately or otherwise. In essence, the opinion merely found the form of Accenture's claim inadequate to justify discovery. However, if the court later found that Guidewire had indeed infringed the patent, it seems possible that a process of discovery could ensue in which evidence of misappropriation could emerge.

Given the tenuous character of the Accenture charges dismissed, Guidewire had insufficient grounds to countercharge. In any case, according to my patent attorney source, it is notoriously difficult to find that one company has maliciously taken action against another in order to interfere with its ability to conduct business. In this particular case, it seems, Accenture is free to say it believes that Guidewire stole its trade secrets rather than alleging such behavior as a fact.

In the meantime, the wheels of justice turn at their accustomed pace, and much treasure must continue to be spent as the case proceeds on the central question of infringement. The spectacle of a very large, established company suing a smaller, newer vendor has raised the question of whether Accenture is engaging in "software by litigation" and thereby establishing a malign precedent for an industry segment that has remained relatively free of such activity. Those who raise that question say they fear an Accenture win will stifle innovation in the insurance software marketplace. However, Accenture's size and power ultimately has no bearing on whether its relevant partners genuinely believe their rights have been violated.

Guidewire's sudden and remarkable success in the market was no doubt a shock, coming at a time when Claim Components was poised to take off in a big way, following its initial success with large insurers such as Chubb. And Accenture's suspicions are not implausible. On the other hand, Accenture's claim that Guidewire couldn't have developed its solution so quickly could be seen as analogous to an incredulous professor who accuses a student of plagiarism merely because the latter writes unexpectedly well. As Judge Robinson wrote, simply believing that Guidewire couldn't have done it doesn't entitle Accenture to a "fishing expedition" to try to find a way to substantiate the suspicion.

The central question remains as to whether Guidewire has infringed Accenture's patent. Guidewire says it hasn't, but that Accenture shouldn't have had the patent in the first place. It's hard to imagine that Claim Components doesn't include a multitude of features that deserve patent protection. At the same time, it is possible that the patent issued includes protection for elements that are generic and shouldn't be owned by anybody.

I have no insight into whether and how the Judge would consider the question of the original patent's validity, but Guidewire reports that the U.S. Patent and Trademark Office has agreed to re-examine Accenture's patent. Clearly, Guidewire expects the USPTO's determination to have some effect on the case, but I have no information as to how the company plans to play that. Perhaps they'll motion for the Judge to suspend proceedings while the USPTO rules, though that is pure speculation on my part.

Whatever the case, the USPTO is backed up owing to a rage for re-examination caused by recent case law, and I'm told that the Delaware U.S. District Court is not known for its speed.The circumstances of a very large established company suing a smaller, newer vendor has raised the question of whether Accenture is engaging in "software by litigation" and thereby establishing a malign precedent for an industry segment that has remained relatively free of such activity. However, Accenture's size and power ultimately has no bearing on whether its relevant partners genuinely believe their rights have been abused.

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