Bloomberg News

Accenture Verdict on Theft of Partner’s Work Upheld by Judge

October 17, 2011

Oct. 17 (Bloomberg) -- Accenture LLP can’t retry a Houston jury’s finding that it maliciously misappropriated a joint marketing partner’s software product and intentionally cut the startup firm out of future business deals, a U.S. judge ruled.

U.S. District Judge Keith P. Ellison upheld a Houston federal jury’s May verdict that consulting giant Accenture stole key components of Wellogix Inc.’s proprietary “purchase to pay” software and used it without compensation.

“Wellogix presented evidence that Accenture not only intended to misappropriate Wellogix’s trade secrets, but that it also intended to cause Wellogix substantial harm,” Ellison said in an Oct. 14 ruling. “There was evidence that Accenture intended to steal Wellogix’s trade secrets and to cut Wellogix out of the business deals with BP and SAP America Inc. Ultimately, the court finds that there is sufficient evidence that Accenture engaged in reprehensible conduct.”

Ellison’s order slashed the $94 million damages awarded the startup software developer to a combined $44 million in compensatory and punitive damages. Ellison said jurors gave Wellogix $50 million more in punitive damages than its lawyers had asked for.

“The amount so exceeds what was requested by Wellogix’s counsel that it appears contrary to right reason,” Ellison said. He ordered Wellogix to either accept the reduced damages award or take its chances on a new trial. He denied Accenture’s request for a new trial in the same order.

Value Plunged

Experts testified during the trial that Wellogix’s value plunged from roughly $27 million during its 2005 joint marketing agreement with Accenture to zero after the consulting firm misappropriated the startup’s trade secrets, Ellison said.

No financial data is available on privately held Wellogix, which said in a 2008 court filing that it raised $40 million in several rounds of venture capital funding to develop its suite of software solutions for the oil and gas industry.

Houston-based Wellogix provides on-demand business process management solutions for energy companies and their service providers, according to Bloomberg BusinessWeek’s private company database.

Accenture is a publicly traded global management consulting firm with 236,000 employees. It recorded $25.5 billion in annual revenue for the fiscal year ended Aug. 31, according to the company’s website. The firm was originally formed as Andersen Consulting in 1989 by partners from the consulting group of Arthur Andersen LLP.

Rick Laminack and Tom Pirtle, Wellogix’s lawyers, didn’t immediately return calls seeking comment on the judge’s order. Christina Rodriguez and Maria Boyce, Accenture’s attorneys, also didn’t immediately return calls for comment today.

The case is Wellogix Inc. v Accenture LLP, 3:08-cv-0019, U.S. District Court, Southern District of Texas (Houston).

--Editors: Mary Romano, Glenn Holdcraft

To contact the reporter on this story: Laurel Brubaker Calkins in Houston at laurel@calkins.us.com.

To contact the editor responsible for this story: Michael Hytha in San Francisco at mhytha@bloomberg.net.


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