Chicago Business Litigation Lawyer Blog
The United States Court of Appeals for the Seventh Circuit recently decided a case concerning the enforceability of an arbitration clause in a trade secret dispute. In its decision, the Court affirmed the district court’s ruling that denied a defendant’s motion to enforce an arbitration clause in a software license agreement entered into under false pretenses by one of the defendant’s employees using the name of a fake company at the request of the defendant.
The two companies involved in the lawsuit, CCC Intelligent Solutions and Tractable, are competitors that provide estimates for the cost of repairing damaged cars and trucks to their customers, including insurance companies. Both do this by applying algorithms, embedded in their software, to data generated by body shops and other repair centers. CCC is a leader in the industry.
CCC licenses its software to third parties. That license prohibits licensees from disassembling the software code or incorporating it into other software. Further the license, forbids a customer from assigning the license without CCC’s consent and requires the licensee to affirmatively represent that he or she is not acting as an agent of any third party. The license includes an arbitration clause. Continue reading ›