According to an article from PCWorld, BoA (Bank of America) is being sued for $300 million dollars by Tibco, an enterprise software company, for illegal copy and distribution of their products. The lawsuit describes how BoA was utilizing Tibco enterprise software in a major IT project for its Merrill Lynch subsidiary. In question is an addendum to a 2010 licensing agreement that allowed BoA to deploy Tibco software solutions and their usage rights.
BoA is accused of stockpiling large quantities of Tibco software while license agreement terms were still active and then deploying the software after the licensing contract expired. What makes the situation even more interesting is that the article reported that Tibco contacted BoA with a “chance to make good” or provide a true-up timeframe, but “the bank refused” to take advantage of that opportunity. The decision to refuse is a difficult one to make since going to court means lots of extra time and expense regardless of outcome. And, since intellectual property (IP) law is all about protecting the IP holder and not the user, it is likely to be an uphill battle for BoA.
Neither organization typically wants their name associated with these sorts of situations. Tibco doesn’t want to appear like the “bad guy” or the bully, and BoA doesn’t want to appear disingenuous to their vendors.
In IAITAM education, we stress that it is critical to use software according to the contract and intellectual property laws, but we also acknowledge how difficult that can be and state that the best defense is to negotiate clarifications into the contract. But, no matter how hard organizations try, contractual breaches occur. In this specific case, we can only guess about the contractual details at the heart of this dispute. However, if your organization was in similar circumstances (hopefully of smaller size in every way), analyze what went wrong and consider changes to prevent something similar happening again.
The circumstances of this incident are generating comments. As stated in the article, BoA, under a proper licensing agreement with Tibco, purchased and utilized Tibco’s enterprise software. It wasn’t until after the licensing agreement expired that BoA had a massive rollout for an upcoming IT project. It was during this rollout that alleged copies of software were illegally made and deployed.
Frank Scavo, an analyst and managing partner for the IT consulting firm Strativa made a very good comment based on how this could have happened and what solutions should be in place. He said:
“The lesson for enterprise IT organizations is to keep track of your software license agreements and be sure you are in compliance…This can be really difficult for large companies, especially those that have grown through a series of acquisitions, like Bank of America has. The only solution is to do a better job of tracking software license compliance through use of an IT asset management system.”
Regardless of organizational size and structure, reducing risk from the software portfolio is a difficult and ongoing responsibility. Reading and discussing occurrences like this one reinforces how important the fundamentals of ITAM are and how large the risk is to the organization.
References:  http://www.pcworld.com/article/2454560/bank-of-america-illegally-copied-300-million-in-software-alleges-tibco-lawsuit.html#tk.rss_all