SOURCE: Data Depth Corp.

May 23, 2005 10:00 ET

Court Rules in Favor of Data Depth on Valeo Preliminary Injunction Motion

"Valeo not likely to prevail at trial."

SEATTLE, WA -- (MARKET WIRE) -- May 23, 2005 -- Data Depth Corporation, a/k/a: iCopyright.net, announced today that the United States District Court has denied a Motion for Preliminary Injunction brought against Data Depth Corporation (DDC) by Valeo Intellectual Property. Data Depth had previously granted Valeo and its affiliates a license to use its "iCopyright Tag" and Instant Licensing Software. In December 2004, Data Depth terminated the agreement because of various breaches by Valeo.

Valeo's Misuse of the iCopyright Tag a Likely Material Breach

Valeo asked the judge to issue a Preliminary Injunction stopping Data Depth from terminating the agreement and from working with Valeo's competitors. The judge refused, saying "...DDC is likely to prevail on its claim that Valeo's misuse of the iCopyright tag is a material breach of the License Agreement....It is also evident that Valeo's alteration of the iCopyright tag was an effort to promote itself at the expense of DDC." The Court further found that "Valeo has not shown that it is likely to prevail in showing that the License Agreement still binds Data Depth."

Valeo's Requested Relief Would Have Violated Data Depth's First Amendment Rights

Valeo also sought a gag on Data Depth's publicizing this dispute, including issuing press releases, such as the one issued on December 29, 2004 (http://www.datadepth.com/News/Valeo_Litigation/Valeo_License_Termination.htm) that announced the termination. The judge refused, saying, "The court finds nothing even potentially false or misleading in the press release." Further, the Court denied Valeo's request for an injunction requiring Data Depth to post Valeo's court filings on the Data Depth website. On this point the Court noted that: "Valeo does not explain how the court could force DDC to provide such a forum without violating the First Amendment." Finally, the court rebuffed Valeo's attempt to stop Data Depth from communicating to the industry its position in this dispute. "Data Depth's statements, in response to inquiries from people in the industry familiar with the instant dispute, are not likely to deceive or mislead."

Data Depth Remains Active in the Market, Offers Valeo New License Agreement

"We are delighted at the Court's ruling," said Mike O'Donnell, President of Data Depth. "We are continuing to develop new technology, actively marketing our software and services, and working cooperatively with other reprint companies." Immediately following the ruling, Data Depth offered to settle the case if Valeo cured its breaches and entered into a new non-exclusive licensing agreement. To date, Valeo and Data Depth have been unable to reach a new agreement. "We are hopeful that we can resolve this matter and assist Valeo to be a successful provider of the iCopyright technology, while preserving and protecting our intellectual property. That's all we ever wanted," said O'Donnell. To date, Data Depth has focused on defending itself against Valeo's Motion for Preliminary Injunction. O'Donnell noted, however, "If we cannot reach a reasonable settlement, then our attorneys will proceed with discovery into the other breaches and claims against Valeo IP."

Termination Prohibits Valeo from Signing New Customers Using iCopyright Software

Under the terms of the license, Valeo has no right to use Data Depth's iCopyright Software to service new customers or to renew contracts for such services once the license agreement has been terminated. This includes The Instant Clearance Service (what Valeo has renamed Valeo Permission Service), Clip&Copy (what Valeo has renamed VipClips), and Publisher Central. Valeo maintains a limited post-termination license for the purpose of completing its current contracts. However, pursuant to the agreement termination provisions, Print Craft, Valeo and other Print Craft affiliates are no longer authorized to sign new agreements with publishers or other third parties as of December 1, 2004, or expand the use of Data Depth's iCopyright Software under existing agreements.

More information on this dispute, including the Court's order denying Valeo's preliminary injunction motion, is available at Data Depth's web site at http://www.datadepth.com.

About Data Depth Corporation a/k/a iCopyright.net

Data Depth Corporation is the developer of iCopyright, the world's first "intelligent copyright" system for digital content. The award-winning system includes The Instant Clearance Service, Publisher Central, Reprint Central, and the Clip&Copy online news clipping service. Millions of works of authorship from hundreds of publications, including those of Associated Press, Reuters, UPI, Forbes, Primedia, and VNU, are tagged for instant licensing through Data Depth Corporation's patent-pending technology.

Contact Information

  • Media Contact for Data Depth Corporation:
    Mike O'Donnell
    206-484-8561
    Mike (@) datadepth.com