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Court Denies New Trial for Gupta and DatabaseUSA

December 20 2018

In the US, the Federal Court has awarded former ORC International owner Infogroup $21.2m in total damages, after confirming that its previous CEO Vinod Gupta and his firm DatabaseUSA.com had stolen Infogroup's intellectual property. Gupta is personally responsible for $10.4m of the fine.

Vinod GuptaGupta (pictured) was sacked from his role as Infogroup's Chairman in 2008, following an investigation which found him guilty of misspending millions of company dollars. As a result of the investigation, he agreed to pay back $9m over a five-year period - at the same time, he received $10m as part of his severance payment. In 2010, he set up Database101 (trading as DatabaseUSA, Infofree.com and AtoZdatabases), with a team which included several of his former colleagues. A year later, Infogroup claimed that Gupta's firm had obtained its database from former employees, and was using it illegally.

In the subsequent lawsuit, Infogroup said it had caught its competitor through the inclusion of a made-up company on its database, to which Gupta's firm was alleged to have sent advertising material just days after its inclusion on the list. In addition, Infogroup's suit also claimed Gupta's firm had poached more than thirty of its employees, some with confidential information said to have been obtained 'prior to their departures'.

Four months ago, Infogroup was awarded $53.6m in damages after a jury found Gupta and DatabaseUSA.com guilty of the charges, with Database additionally liable for false advertising, copyright infringement and mark infringement. As part of the verdict, the jury ruled in favor of Infogroup on all charges and concluded that Database should pay $43.6m, while Gupta himself should pay $10m for breaching the 2008 separation agreement.

The Court has now upheld the earlier jury verdicts, but has gone further to find that the misconduct of Gupta and DatabaseUSA presented an 'exceptional case' in which they 'intentionally destroyed key evidence and wilfully and deliberately violated federal laws'. In addition, the Court has ordered Gupta and DatabaseUSA to preserve their financial records and to refrain from transferring their assets until the judgment is paid in full.

Web sites: www.infogroup.com and www.databaseusa.com .

All articles 2006-21 written and edited by Mel Crowther and/or Nick Thomas unless otherwise stated.

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