Litigation Update

Read Updated April 2016 blog on Litigation

Read Updated September 2016 blog on Litigation

In November 2013, EMC sued Pure in federal court in Delaware, claiming that Pure infringed five patents involving various data storage technologies. Last week, the case went to trial – and the case wrapped up this afternoon.

Before the trial started, EMC dropped one patent from the case, and the judge in a pre-trial summary judgment ruling found that we didn’t infringe another. In the same ruling, the judge hearing the case found that Pure infringed certain claims of one of EMC’s patents related to de-duplication technology.

The seven-day trial, therefore, focused on two questions:

  • Whether we infringed two EMC patents dealing with de-duplication and RAID storage.
  • Whether the de-duplication patent that the judge found we infringed was actually valid.

The jury’s verdict was split.

  • The jury found that Pure did not infringe either of the two patents they were asked to consider.
  • However, the jury also found to be valid the one patent that we were found to have infringed by the judge.

The jury awarded EMC damages of $14 million. EMC had originally sought more than $80 million.

Our view has been and remains that EMC’s litigious approach to competition primarily reflects efforts to stabilize its storage business as customers around the world abandon the kind of disk-based storage systems EMC pioneered in favor of flash-based storage from innovative companies like Pure. As the trial proceedings made clear, EMC built its own flash-based storage products via acquisition, rather than organic innovation.

We are gratified that the jury agreed with our view of the facts on most of the issues at trial, although we are disappointed with the one ruling not in our favor on one of EMC’s de-duplication patents. We continue to believe that both the facts and the law are on our side on that issue – and we are considering our options for appealing that aspect of the decision.

It is important to note this ruling will not disrupt Pure, our customers or our partners:

  • We will continue to sell the same set of products and services that drove 150% top-line growth in our fiscal year ended January 31, 2016.
  • We do not expect to pay any ongoing royalties to EMC.
  • We have alternatives ready to go for the software feature that the Court found to be infringing EMC’s de-dupe patent.
  • Pure has sufficient financial resources such that the proposed damages – if upheld on appeal – will not slow us down.

As Pure CEO Scott Dietzen wrote in a blog post in 2013, Pure welcomes marketplace competition. Competition drives innovation and customer value. Competition makes our products better and makes us into a better company, more attuned to customer and partner needs. Competition also fuels market growth. We look forward to continuing to compete with EMC in the public marketplace.

Read Updated April 2016 blog on Litigation