SecurityBrief Australia logo
Australia's leading source of cybersecurity and cyber-attack news
Story image

Appian awarded billions in damages against Pegasystems Inc.

By Mitchell Hageman
Thu 12 May 2022

Appian has been awarded USD$2.036 billion in damages against Pegasystems Inc as the result of a jury verdict in the Circuit Court for Fairfax County, Virginia.

The verdict resulted in Pegasystems being held liable for trade secret misappropriation and violation of the Virginia Computer Crimes Act, resulting in the significant payout to Appian.

Appian brought the case to trial to ensure the protection of its proprietary intellectual property, including its trade secrets. The jury subsequently found Pegasystems' misappropriation of Appian's trade secrets to be willful and malicious.

"We are very grateful that the jury held Pegasystems accountable for its wrongful conduct," says Appian general counsel Christopher Winters. 

"We put forward strong evidence that Appian trade secrets were misappropriated by Pegasystems. The award of substantial damages to Appian is entirely appropriate given the nature and extent of what Pegasystems did."

During the seven-week trial, Appian put forward that Pegasystems hired an employee of a government contractor (the "Contractor") to provide Pegasystems with access to Appian's software in order to learn more about it and create a competitive strategy.

It was found that when hiring the Contractor, Pegasystems instructed its third-party contracting service to recruit someone who was not "loyal" to Appian. 

Appian gave evidence that the Contractor, who ultimately worked as a developer in the Appian software under a government contract, violated his employer's code of conduct and his employer's agreement with Appian by providing access to a competitor.

Appian also put forward that the Contractor passed trade secret information to Pegasystems, allowing its employees to build competitive features and train Pegasystems' sales team to better compete against Appian.

Pegasystems' founder and CEO Alan Trefler admitted during the proceedings that it was "inappropriate" for Pegasystems employees to have hired the Contractor, and that the Contractor "apparently did things for which he was not entitled."

It was also revealed that Pegasystems internally referred to the Contractor as a "spy". This person proceeded to help Pegasystems generate dozens of video recordings of the Appian development environment for use by Pegasystems in compiling competitive materials and evaluating improvements to its platform.

Appian put forward that Mr Trefler attended and participated in a meeting with the Contractor and received Appian's trade secrets supplied by the Contractor. Pegasystems then used videos and documents created in connection with the Contractor's efforts to train its sales force to better compete against Appian. 

The effort was later labelled "Project Crush" within Pegasystems. At one point, a Pegasystems employee reviewing the materials exclaimed that "we should never lose to Appian again!"

Appian submitted that Pegasystems' product development team reviewed materials provided by the Contractor and changed the course of Pegasystems' product engineering to take advantage of the Appian technology they saw. 

Specifically, Appian put forward documents and testimony that Pegasystems made use of the trade secrets gleaned from the Contractor to make improvements with respect to, among other things, ease of use, and social and mobile capabilities in the Pegasystems platform.

Appian also presented undisputed evidence that Pegasystems employees used false identities to obtain access to Appian information and trial versions of Appian's software to be used for competitive purposes. Mr Trefler admitted to using an alias, "Albert Skii" to obtain access to Appian information, and others reportedly used aliases and partner credentials under license.

Trefler admitted he did not think it was appropriate "for people to access other company's systems through aliases" and that the Pegasystems employees who gained access to Appian trial software "shouldn't have done it."

Appian believes the damages awarded are the largest in Virginia state court history. The company may also be entitled to further award of attorney's fees under Virginia law.

The jury's verdict and the court's entry of judgment are subject to appeal by Pegasystems. The company is not required to pay Appian the amount awarded by the jury until all appeals are exhausted and the judgment is final.

Appian was represented in the case by Patterson Belknap Webb & Tyler, led by Adeel Mangi, Muhammad Faridi, and Jeff Ginsberg, and by Holmes Costin & Marcus, led by Ellen Marcus and Sheila Costin. 

John McNichols, of Williams and Connolly, also appeared in the case on behalf of Appian. Christopher Geyer, Appian's Deputy General Counsel for IP & Litigation, played a lead role in developing the case and managing the litigation in-house.

Related stories
Top stories
Story image
Cybersecurity
The 'A-B-C' of effective application security
Software applications have been a key tool for businesses for decades, but the way they are designed and operated has changed during the past few years.
Story image
Ivanti
Ivanti and Lookout bring zero trust security to hybrid work
Ivanti and Lookout have joined forces to help organisations accelerate cloud adoption and mature their zero trust security posture in the everywhere workplace.
Story image
BeyondTrust
BeyondTrust integrates Password Safe solution with SailPoint
BeyondTrust has announced the integration of BeyondTrust Password Safe with SailPoint identity security offerings.
Story image
SaaS
Absolute Software expands Secure Access product offering
Absolute Software is enhancing its Secure Access product portfolio, enabling minimised risk exposure and optimised user experiences in the hybrid working environment.
Story image
Digital Transformation
Physical security systems guide the hybrid workplace to new heights
Organisations are reviewing how data gathered from their physical security systems can optimise, protect and enhance their business operations in unique ways.
Story image
Firewall
Sophos named Gartner Peer Insights Customers Choice for network firewalls
The company earned the highest overall customer rating among vendors with at least 150 verified customer reviews.
Story image
Application Security
Data Theorem launches "industry first" attack surface management solution
"No solution uses full-stack application runtime analysis and dynamic inventory discovery to support the challenges around vendor management."
Story image
Akamai
Akamai and Fujitsu team up to protect A/NZ orgs against threats
Akamai Technologies and Fujitsu Australia and New Zealand have entered a strategic relationship to assist organisations in the region.
Story image
Cybersecurity
Three key security challenges facing the Australian insurance industry 
Insurance companies must ensure they proactively address security challenges and protect the privacy of customer data.
Story image
Cybersecurity
New precedent for cybersecurity after legal judgement of RI Advice
In an Australian first, the Federal Court has found that RI Advice failed to adequately manage cybersecurity risks.
Story image
Mitiga
Mitiga discovers potential hidden dangers in Google Cloud Platform’s (GCP) cloud control plane
The company also says that there is significant risk in cloud development caused by not recognising the differences between cloud and traditional definitions of common architecture terms.
Story image
Cybersecurity
ThoughtLab reveals 10 best practices for cybersecurity in 2022
The benchmarking study reveals best practices that can reduce the probability of a material breach and the time it takes to find and respond to those that happen.
Story image
Phishing
Developments in phishing and how to protect your business
Phishing, the practice of sending malicious emails to encourage users to perform actions that benefit an attacker, is a key security concern for modern businesses due to its prevalence and impact.
Story image
Malware
Sharp increase in phishing as cybercriminals leverage SEO to lure victims
"Malware lurking everywhere, from cloud apps to search engines, leaving organisations at greater risk than ever before."
Story image
Ransomware
Anniversaries remind us to review identity risks
World Password Day provides a timely reminder for ordinary citizens and organisations to stop and think about the risks associated with digital identities.
Story image
Cybersecurity
Video: 10 Minute IT Jams - An update from IronNet
Michael Ehrlich joins us today to discuss the history of IronNet and the crucial role the company plays in the cyber defence space.
Story image
Cybersecurity
A10 Networks finds over 15 million DDoS weapons in 2021
A10 Networks notes that in the 2H 2021 reporting period, its security research team tracked more than 15.4 million Distributed Denial-of-Service (DDoS) weapons.
Story image
APAC
Odaseva expands in APAC and UK with more security features
Odaseva, a data platform for Salesforce, is establishing new headquarters in London as well as a new data center in India.
Story image
Application Security
What are the DDoS attack trend predictions for 2022?
Mitigation and recovery are vital to ensuring brand reputation remains solid in the face of a Distributed Denial of Service (DDoS) attack and that business growth and innovation can continue.
Story image
Tech job moves
Tech job moves - Datacom, Micro Focus, SnapLogic and VMware
We round up all job appointments from May 6-12, 2022, in one place to keep you updated with the latest from across the tech industries.
Story image
Cybersecurity
Companies rushing to secure print infrastructure
As the pandemic prioritised communication channels and the shift to remote work, IT departments fell behind in updating the security of print and IT infrastructure.
Story image
Sift
Sift shares crucial advice for preventing serious ATO breaches
Are you or your business struggling with Account Takeover Fraud (ATO)? One of the latest ebooks from Sift can provide readers with the tools and expertise to help launch them into the new era of account security.
Story image
Training
Fortinet training edges toward closing cybersecurity gap
The Fortinet Training Institute has made significant progress in closing the cybersecurity skills gap, on track to train one million people by 2026.
Story image
Fortinet
Fortinet sees 34% revenue increase in latest financial results
Fortinet has released its financial results for the first quarter ended March 31, 2022, seeing a total revenue increase of 34.4% compared to the same quarter last year.
Story image
Blue Prism
Blue Prism Desktop uses IA to defend against vulnerabilities
SS&C Blue Prism Desktop aims to help protect businesses against vulnerabilities, using a combination of security measures and intelligent automation tech.
Story image
UiPath
Employee retention increasingly important - automation may help
"Technologies like automation can free workers time, enable a better work-life balance, and create vastly improved efficiencies."
Story image
Ransomware
Cybersecurity starts with education
In 2021, 80% of Australian organisations responding to the Sophos State of Ransomware study reported being hit by ransomware. 
Story image
Cybersecurity
Global bot security market to reach US$2.5 billion by 2032
The global bot security market to reach US$2.5 billion by 2032 driven by a growing need for cyber security, according to a new report.
Story image
Artificial Intelligence
ForgeRock releases Autonomous Access solution powered by AI
ForgeRock has officially introduced ForgeRock Autonomous Access, a new solution that uses AI to prevent identity-based cyber attacks and fraud.
Story image
Ransomware
Ingram Micro Cloud adds Bitdefender solutions to marketplace
Ingram Micro Cloud has announced the expanded availability of Bitdefender solutions on the Ingram Micro Cloud Marketplace.
Story image
Microsoft
Apple, Google and Microsoft expands plans to get rid of passwords
FIDO Alliance says the world is closer to not relying on passwords after Apple, Google and Microsoft expands their support for a passwordless sign-in standard.
Story image
Surveillance
Genetec launches new enclosure management system for data centers
Genetec has released a new enclosure management solution that will give data centers the ability to secure, monitor and manage access to racks and cabinets remotely.
Story image
Cybersecurity
CyberArk launches $30M investment fund to advance security
CyberArk has announced the launch of CyberArk Ventures, a $30 million global investment fund dedicated to advancing the next generation of security disruptors.
Story image
Forensics
Exterro adds advanced capabilities to digital forensic tool
The launch is in-line with Exterro’s investment in the FTK product line, and underscores the company's commitment to the digital forensics.
Story image
Ransomware
Zerto unveils updates to ransomware recovery capabilities
"Organisations face increased risks from the volume and sophistication of ransomware attacks prevalent today."
Story image
Malware
Use of malware, botnets and exploits expands in Q1 2022
"As zero-day attacks and other vulnerabilities among companies like Google and Microsoft come to light, threat actors are quickly adjusting their tactics."
Story image
Tech job moves
Tech job moves - Cisco, Hitachi Vantara, Tricentis & Zscaler
We round up all job appointments from April 28 - May 5, 2022, in one place to keep you updated with the latest from across the tech industries.
Story image
VPN
Palo Alto Networks says ZTNA 1.0 not secure enough
Palo Alto Networks is urging the industry to move to Zero Trust Network Access 2.0 because previous versions have major gaps in security protection.
Story image
Microsoft
Microsoft unveils three new security managed services
Security Experts includes three new managed services, Defender Experts for Hunting, Defender Experts for XDR, Security Services for Enterprise.
Story image
Artificial Intelligence
Updates from Google Workspace set to ease hybrid working troubles
Google Workspace has announced a variety of new features which will utilise Google AI capabilities to help make hybrid working situations more efficient and effective.
Story image
Phishing
Google reveals new safety and security measures for users
Google's new measures include automatic two step verification, virtual cards and making it easier to remove contact information on Google Search results.
Story image
Secure access service edge / SASE
Versa Networks recognised as SASE leader in Govie Awards
Versa Networks has announced its SASE offering has been recognised in The Govies Government Security Awards competition by Security Today magazine.
Story image
Appian
Appian awarded billions in damages against Pegasystems Inc.
Appian has been awarded USD$2.036 billion in damages against Pegasystems Inc as the result of a jury verdict in the Circuit Court for Fairfax County, Virginia.
Story image
Manufacturing
$1 million in cyber skills to stop $100 million in cybercrime
"It is important that the next generation across all industries, including manufacturing, are skilled in cybersecurity."