The legal industry has witnessed a significant development in the Akin Gump v Xcential lawsuit, as the US court denied Akin Gump’s motion to dismiss the counterclaims filed by Californian legal technology company Xcential Legislative Technologies. The lawsuit centers around who really invented a piece of bill-drafting software, and the recent ruling by D.C. Superior Court Judge Juliet McKenna is a major victory for Xcential.

Background of the story

Akin Gump had claimed that Xcential's Bill Synthesis software was invented by Louis Agnello, Counsel at Akin Gump. In October, they filed a lawsuit against Xcential claiming damages, alleging that Xcential incorporated a concept presented to them under a non-disclosure agreement (NDA) by Agnello into their existing LegisPro software. This idea, as claimed by Akin Gump, involves utilizing suggested redline modifications to an existing legislation to produce a draft bill that complies with the appropriate format for Congressional submission, thereby speeding up the bill drafting process, improving precision, and reducing costs.

In its lawsuit, Akin alleged that Xcential failed to provide a prototype despite numerous discussions and demonstrations. Instead, its CEO and founder Grant Vergottini submitted a patent application for a renamed version of Akin's product called 'Bill Synthesis.' For these reasons, Akin is now seeking damages for various claims, which, among others, include misappropriation of trade secrets, breach of a contract, unjust enrichment, and replevin, which allows for the recovery of wrongfully taken goods.

In response, Xcential filed five counterclaims, and the court dismissed the petition with regard to only one of them. The court found that Xcential had adequately asserted the grounds for a breach of contract (count one); sufficiently alleged all elements in support of a claim of misappropriation of trade secrets and confidential information (counts two and three); adequately pled a breach of implied contract that would entitle them to relief if proved to be true (count four).

The ruling represents a significant win for Xcential, which claimed it invented the bill-drafting technology alone. Xcential’s Co-founder and CEO, Grant Vergottini, expressed his satisfaction with the ruling and his commitment to protecting the rights of inventors to patent and market their innovative products. “Only Xcential has created software that functions as described in the patent application for Bill Synthesis. We will not be intimidated into surrendering our know-how and intellectual property to a giant law firm like Akin Gump. This litigation should be a warning to all innovative legal technology providers,” said Vergottini.  

Why is this ruling important?

This lawsuit is a reminder of the importance of protecting intellectual property in the legal industry, particularly as technological innovations become increasingly prevalent. With the increasing use of legal technology, it is essential for firms to protect their inventions from misappropriation.

The case also highlights the need for careful consideration of intellectual property ownership when collaborating on new projects. And since the legal industry continues to embrace technological innovations, it is essential for parties to have clear agreements in place regarding ownership and use of intellectual property before beginning any collaborative projects.