UPDATED 10:49 EDT / APRIL 04 2011

Cloud Companies Face Legal Fiasco, Federal Courts Become Battlegrounds

With information technology shaping the world that we know today, the industry has been attracting all sorts of controversies, lawsuits and wrongdoings. Patent infringement has become a staple food of the industry. One of the more interesting cases worth following is the largest crackdown on hedge-fund insider trading in the history of the United States—the Rajaratnam trial, which involved the giant cloud company, Cisco.

Cisco System Inc.’s acquisition of Starent Networks Corp. in 2009 is a piece of the case that mogul Rajaratnam and his company, Galleon is facing for three weeks now. The $5.4 billion deal on July 24, 2006 Advanced Micro Devices Inc and ATI Technologies is also a part of this hullabaloo.

The trial rose to prominence (of course, in a negative fashion) for loads of tapped FBI recordings on Rajaratnam’s mobile phone. One of which took place in 2008, when Rajaratnam was heard telling David Lau, who ran Galleon’s office in Singapore “I just heard from somebody who’s on the board of Goldman Sachs, they are gonna lose $2 per share. So what he was telling me was that, uh, Goldman, the quarter’s pretty bad.”

In other headlines, titans are still clashing as Oracle-Hewlett-Packard scuffle continues over Intel Itanium microprocessor. The announcement of halting the release of all development circling this software was announced by Oracle shortly after they celebrated a 78% surge in profits for the 3rd quarter of 2010. They recently sued Starbucks over the “Java” trademark. Looks like Oracle still loves “taking somebody to court.” One the other hand, HP is still haunted by the sexual harassment case of its former executive Mark Hurd.

A cease-fire may be a distant hope as competition continues to thrive in this industry and current economy. People will have to bear, for quite some time, headlines that foray who sued who, and the strangest lawsuits are those that can slap the opponent down. The court of law is without a doubt becoming an extension of the coliseum of tech wars.


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