U.S. Federal Jury Unanimously Finds Vade Secure Willfully Misappropriated Proofpoint Trade Secrets and Infringed Proofpoint Copyrights

Rhea-AI Summary

On August 24, 2021, a U.S. federal jury found Vade Secure willfully misappropriated trade secrets from Proofpoint, awarding the latter approximately $13.5 million in compensatory damages. The court's decision regarding punitive damages is pending. Proofpoint demonstrated Vade unlawfully utilized its confidential information in products like Vade for Microsoft 365. Vade's Chief Technology Officer was also found liable. CEO Gary Steele emphasized the importance of intellectual property rights and the necessity to protect them in the cybersecurity space.

Positive

• Proofpoint awarded $13.5 million in compensatory damages.
• Strong jury verdict on the misappropriation of trade secrets signals industry support for IP protection.

Negative

• Pending decision on punitive damages could indicate potential additional financial liabilities.
• Legal proceedings may distract from core business operations.

SUNNYVALE, Calif., Aug. 24, 2021 (GLOBE NEWSWIRE) -- A U.S. federal jury unanimously found Friday that Vade Secure (Vade) willfully and maliciously misappropriated over a dozen trade secrets and infringed copyrights belonging to Proofpoint, Inc. (NASDAQ: PFPT) and its subsidiary Cloudmark LLC, awarding Proofpoint approximately $13.5 million in compensatory damages for Vade’s unjust enrichment to date. The Court’s decision on punitive damages for Vade’s willful misappropriation of the trade secrets is expected in late October. Proofpoint will also be seeking injunctive relief to address ongoing and future harm to Proofpoint.

The verdict is the culmination of one week of jury deliberations following a three-week trial during which Proofpoint presented evidence of Vade’s theft and use of Proofpoint’s confidential and proprietary information and source code. Proofpoint successfully demonstrated to the eight jurors that Vade unlawfully took, copied, and used Proofpoint’s trade secrets and copyrighted source code as part of several Vade products, including Vade for Microsoft 365, Email Content Filter, Vade Cloud, and Vade MTA Builder. Vade’s Chief Technology Officer, Olivier Lemarié, was also found individually liable for trade secret misappropriation, copyright infringement, and breach of his employment agreement with Cloudmark, where he worked before joining Vade in 2017.

“Proofpoint invests heavily in R&D to provide innovative and highly effective products to its customers. At the heart of this case was our strong belief that intellectual property rights must be respected,” said Gary Steele, CEO & Chairman, Proofpoint. “While we welcome fair competition and collaboration within the cybersecurity community, the misappropriation, copying, and theft of our intellectual property required us to vigorously enforce our rights. We appreciate the jury sending a strong message that the theft of source code and misappropriation of trade secrets is unacceptable.”

About Proofpoint, Inc.

Proofpoint, Inc. (NASDAQ: PFPT) is a leading cybersecurity and compliance company that protects organizations’ greatest assets and biggest risks: their people. With an integrated suite of cloud-based solutions, Proofpoint helps companies around the world stop targeted threats, safeguard their data, and make their users more resilient against cyberattacks. Leading organizations of all sizes, including more than half of the Fortune 1000, rely on Proofpoint for people-centric security and compliance solutions that mitigate their most critical risks across email, the cloud, social media, and the web. More information is available at www.proofpoint.com.

Connect with Proofpoint: Twitter | LinkedIn | Facebook | YouTube

Proofpoint is a registered trademark or tradename of Proofpoint, Inc. in the U.S. and/or other countries. All other trademarks contained herein are the property of their respective owners.

PROOFPOINT MEDIA CONTACT:
Kristy Campbell
Proofpoint, Inc.
(408) 850-4142
kcampbell@proofpoint.com

FAQ

What was the jury's verdict against Vade Secure related to Proofpoint?

A jury found Vade Secure guilty of willfully misappropriating trade secrets from Proofpoint, awarding Proofpoint approximately $13.5 million in compensatory damages.

What are the implications of the jury's decision for Proofpoint's stock (PFPT)?

The jury's decision reinforces Proofpoint's position in protecting its intellectual property, which may positively influence investor confidence and stock performance.

When will the court decide on punitive damages for Vade Secure?

The court's decision on punitive damages for Vade Secure is expected in late October 2021.

What products were involved in the trade secret misappropriation case with Vade?

The products involved included Vade for Microsoft 365, Email Content Filter, Vade Cloud, and Vade MTA Builder.

Who was found personally liable in the Vade Secure case against Proofpoint?

Vade's Chief Technology Officer, Olivier Lemarié, was found personally liable for trade secret misappropriation and copyright infringement.