MOUNTAIN VIEW, California – Pure Storage has reached
a settlement agreement with EMC Corporation, putting an end to the legal drama that
lasted for three years between the two tech companies.
In an effort to
put their legal woes behind them, both Pure Storage and EMC agreed to settle
their issues to the tune of $30 million payable to Dell Technologies. This agreement
came with provisions for both companies to mutually drop all the legal matters
they filed against each other, which included patent ownership issues. These
lawsuits were filed before EMC executed a merger with Dell worth $60 million.
“Pure Storage (NYSE: PSTG) and EMC today have
agreed to settle all litigation between the two companies. The specific terms of
the settlement are confidential, but include a payment to Dell, the dismissal
of all litigation between the parties, mutual releases and a license to the
disputed patent,” announced Pure Storage in a press
release following the settlement agreement.
agreement, according to the Wall
Street Journal, would effectively rid Pure Storage of the concerns linked
to Dell as the former has just gone public last year. With the issues from way
back in 2013 now behind the Silicon Valley startup, the data flash storage
company can be expected to focus more on their chips, called flash memory, to challenge
other big names in the data storage wars.
started in 2013 when EMC filed a lawsuit against Pure Storage in U.S. District Court for the District of Delaware. According to the
petitioners, the move of the startup company to hire more than 40 former
employees of EMC was a strategy to steal trade secrets. EMC also alleged that
Pure Storage aimed to impede its business relationships as well as interfere
with the non-compete agreements with its workers.
Pure Storage filed a counterclaim against EMC and made several allegations as
well. These included its claim that EMC only filed its lawsuit to defame
the startup. In addition, it purported that EMC also stole the trade secrets of
In an earlier
interview with Yahoo,
Pure Storage CEO Scott Dietzen shared his opinion of the non-compete
“They are not
enforceable in the state of California (the market where Pure is
headquartered). But, in general, I don’t think they’re moral. I think people
should be free to work where they see fit, so we would never ask our employees
to sign a noncompete. They just have to guard our confidential information,”
said Dietzen via Yahoo.
Apart from these
lawsuits, a separate case also involved the two companies regarding a data
storage patent. In March, EMC was declared the winner of the said case. At the
time, Pure Storage failed to convince the federal jury in Delaware that it did
not infringe on an EMC patent. It was ordered to pay EMC with $14 million in
damages. However, a judge ordered that the case should be sent back for a new
trial in September. With the settlement agreement between the two companies, Dell
was ordered to license the patent under the name of Pure Storage.