CoStar Not Letting Up On Lawsuit, Plans To Pursue Action Against Xceligent Parent DMGT
Want to get a jump-start on upcoming deals? Meet the major players at one of our upcoming national events!
D.C.-based CoStar Group strengthened its grip on the commercial real estate data industry Thursday when its largest competitor shut down, effective immediately.
But despite Xceligent filing for Chapter 7 liquidation, CoStar is not slowing down its legal pursuit. It now appears to be shifting its focus to Xceligent's parent company, London-based Daily Mail and General Trust.
"While the bankruptcy has stayed the case against Xceligent, CoStar will continue legal efforts to hold accountable those involved in the theft of its intellectual property," a company spokesperson said in a statement to Bisnow Friday morning.
Williams & Connolly partner Nick Boyle, CoStar's lead attorney, specified in a statement Friday afternoon that these legal efforts could include entities other than Xceligent and it could play out in other areas than Missouri, where the case began.
“We will continue to litigate on behalf of CoStar across multiple jurisdictions and intend to hold to account every person who participated in this wrongdoing," Boyle said. "There is no question that those involved include individuals and entities beyond Xceligent itself.”
CoStar sued Xceligent in December 2016 for intellectual property theft and began widening its legal efforts recently to include current and former DMGT executives and other companies DMGT owns.
CoStar filed notice Dec. 12 for an oral deposition of Joe Emison, the head of product and technology for DMGI, the company's U.S. affiliate. The day before, CoStar filed subpoena of documents to Trepp, another of DMGI's U.S. information companies.
CoStar filed notice Dec. 4 to subpoena Eric Frank, who worked as executive adviser at DMGI from September 2014 to March of this year. He was also a member of Xceligent's board until nine months ago, according to LinkedIn. CoStar also subpoenaed Andy Liebman, who has worked as senior vice president at Trepp since 2000.
DMGT told investors Nov. 30 it had written Xceligent's value down to zero and was reviewing all options for the company. The company's stock dropped 24% that day and has not fully recovered, today trading at 14% below its Nov. 29 value.
In its Thursday announcement of Xceligent's closure, DMGT said responsibility for current litigation involving Xceligent will be assumed by the Chapter 7 trustee and it holds no liability for future costs associated with the litigation.
But with CoStar pledging to continue its legal efforts, it remains a possibility that the data giant could file a separate suit targeting DMGT for its involvement in the alleged intellectual property theft.
UPDATE, DEC. 15, 2:25 P.M. EST: This story has been updated to include a statement from Williams & Connolly partner Nick Boyle, CoStar's lead attorney.