UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

FORD MOTOR COMPANY, CASE NO. 15-10628-MFL-EAS

Plaintiff/Counter-Defendant, (Consolidated with

Case No. 15-11264- MFL-EAS v.

Hon. Matthew F. Leitman

VERSATA SOFTWARE, INC., F/K/A

TRILOGY SOFTWARE, INC., TRILOGY

DEVELOPMENT GROUP, INC. AND

TRILOGY, INC.,

Defendants/Counter-Plaintiffs.

DEFENDANTS’ ANSWER TO PLAINTIFF’S SECOND AMENDED 

COMPLAINT FOR DECLARATORY JUDGMENT, AFFIRMATIVE AND 

SPECIAL DEFENSES; DEFENDANTS’ COUNTERCLAIMS, AND 

RELIANCE ON JURY DEMAND

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ANSWER

Defendants Versata Software, Inc., f/k/a Trilogy Software, Inc., Trilogy 

Development Group, Inc.,1 and Trilogy, Inc. (collectively, “Versata”) by their 

attorneys, Steven J. Mitby of the Houston, Texas law firm of AHMAD, 

ZAVITSANOS, ANAIPAKOS, ALAVI & MENSING, P.C., and Rodger D. Young 

of the Farmington Hills, Michigan law firm of YOUNG & ASSOCIATES, hereby 

file this Answer to the Second Amended Complaint of Plaintiff Ford Motor 

Company (“Ford”). Versata incorporates by reference Defendants’ First Amended 

Answer to Plaintiff’s Complaint Filed In Case No. 15-11624, Affirmative and 

Special Defenses, and Reliance on Jury Demand (Dkt. 92).

PRELIMINARY STATEMENT

Plaintiff Ford Motor Company Has Misappropriated Versata’s Trade Secrets 

and Infringed Versata’s Patents and Copyrights

Ford Motor Company is one of the biggest automotive companies in the 

world. Ford’s success depends on complex software that works behind the scenes 

to enable Ford to design, develop, manufacture, distribute, market, and sell vehicles 

on four continents. The backbone of this global system is Versata’s Automotive 

Configuration Manager (ACM), a software program that Versata developed in 

 1 Trilogy Development Group, Inc. changed its name to Versata Development 

Group, Inc. in 2006. All references herein to Trilogy Development Group, Inc. 

herein shall also include Versata Development Group, Inc. 

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Austin, Texas at a cost of hundreds of thousands of person-hours and millions of 

dollars. 

Versata’s ACM software enables Ford to “configure” vehicles from billions 

of potential combinations of parts, features, and options. By solving the complex 

mathematical, logical, and logistical problems involved in designing and configuring 

vehicles, ACM ensures that every Ford vehicle consists of compatible parts and 

features that Ford can manufacture. In addition, the software ensures that each Ford 

vehicle configuration complies with Ford’s sales, marketing, and other business 

requirements. In short, ACM ensures that the automotive designs Ford develops are 

for vehicles that Ford can build, manufacture, and sell.

Ford began using Versata’s automotive configuration technology in October 

1998 after experimenting unsuccessfully with homegrown solutions. Ford tried, but 

ultimately failed, to develop software that was sophisticated, accurate, and efficient 

enough to meet its configuration needs. By the late 1990s, these needs had become 

critical because Ford had lost hundreds of millions of dollars because of 

configuration errors. Ford incurred these costs primarily because its existing 

configuration process – which depended heavily on large teams of engineers, 

involved extensive manual inputs, and was subject to significant risk of human error 

– caused multi-million dollar vehicle recalls and manufacturing delays. 

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Between October 1998 and January 2015, Versata became Ford’s chief 

provider of configuration software. Ford integrated ACM throughout its business 

and came to depend on Versata to run its global operations. Because ACM provides 

the configuration models that determine the products Ford can design and build, 

Ford has integrated ACM with its global design, development, finance, marketing, 

dealer ordering, and retail website software. In short, Ford’s global information 

technology infrastructure was totally dependent on – and could not function without 

– ACM. Because of this dependence, Ford could not design, manufacture, or sell a 

single vehicle without Versata’s technologies.

In or before 2011, Ford management became concerned about the extent of 

Ford’s dependence on ACM and did not want to pay the relatively modest price 

increases that Versata requested as part of license renewals. Even though Ford was 

receiving hundreds of millions and perhaps billions of dollars in benefits from 

Versata software, Ford’s management decided it wanted to break ties with Versata. 

Ford vice president Elena Ford (who is also an influential shareholder within the 

company) expressed her distaste for Versata and told a colleague that Ford would 

not do business with Versata because Versata had allegedly “put Ford over a barrel.” 

But Ford did not have any software that it could use to replace ACM or reduce its 

need for Versata’s technologies. So, based on this pressure from upper management, 

Ford launched a program called “Total Configuration Management” or “TCM” to 

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replicate the functionality of ACM and provide a complete replacement for ACM 

software.

Ford now claims that TCM (which Ford later renamed “Product Definition 

and Offer” or “PDO”) uses entirely different technologies from ACM, claiming that 

the company implemented a “Chinese wall” to protect Versata trade secrets and 

emphasizing the fact that Ford obtained a patent (U.S. Patent No. 8,812,375) on 

some of the technology used in this software. However, the functionality of the 

TCM software and the development process Ford used to create it refutes this 

assertion. Even without any fact discovery, it is evident that Ford incorporated 

Versata’s patented technologies and trade secrets into TCM and used these 

technologies to replace ACM.

First, far from employing a “Chinese wall,” Ford used at least twenty-six 

people – and possibly more – who had worked on or had access to Versata’s 

configuration technologies to develop TCM. The head of this development project 

was Mike Sullivan, the Ford executive who had overseen Ford’s implementation and 

integration of ACM since at least 2000. Indeed, Sullivan had unrestricted access to 

ACM for more than a decade before he was assigned to lead the TCM development 

process and Sullivan continued to work on ACM simultaneously with TCM. The 

other individuals on both sides of Ford’s “Chinese wall” include Bryan Goodman, 

Gintaras Puskorius, Kurt Reinke, Sanjay Sisale, Ram Pillarisetty, Garghi Shah, 

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David Wierzbicki, Sunil Gajula, Manisha Tambe, Darlene Coomer, Jian Lin, Fred 

Wilkinson, Linda Wu, Rachel Sims, Chris Andrews, Martin Pipoly, Yakov Fradkin, 

Jim Beardslee, Ravi Kundoor, Ganesh Alla, Erin Jasso, Aaron Bush, Rachel Smith, 

Sai Viswanatha, and Colin Shury. Versata expects to identify even more individuals 

through discovery. 

Ford’s deliberate use of people who had significant knowledge of and 

exposure to ACM confidential information was not a coincidence: These individuals 

could not simply “forget” or “separate” what they knew about ACM from their work 

on the TCM replacement software for ACM – especially when Ford was under 

pressure to develop replacement software that would eliminate Ford’s dependence 

on Versata. 

Second, Ford’s public patent filings – which purport to describe the 

technologies used in TCM – actually demonstrate that Ford incorporated numerous 

Versata technologies into TCM. These patent filings include U.S. Patent No. 

8,812,375 and U.S. Patent Publication No. US20140279602. 

Even if Ford added additional elements to its patent claims in order to secure 

Patent Office approval (a claim which is, at best, open to question), the fundamental 

basis of both of these patent filings is technology that Ford obtained and copied from 

Versata. Not surprisingly, the named inventors on these Ford patent filings include 

at least eight people who gained knowledge of Versata configuration technologies 

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such as Bryan Goodman, Gintaras Puskorius, Jian Lin, Martin Pipoly, Yakov 

Fradkin, Ravi Kundoor, Ganesh Alla, and Jim Beardslee. 

Third, TCM functions as a complete replacement for ACM and was integrated 

with downstream design, development, finance, marketing, dealer ordering, and 

retail website systems without any change to those systems. The fact that Ford was 

able to remove ACM and replace it with TCM without changing any downstream 

systems highlights the overlap between TCM and ACM software. 

Fourth, at the end of 2014, Ford made several desperate attempts to renew its 

ACM license by subterfuge, signaling that Ford was not ready to stop using ACM 

when its license expired in January 2015. For example, in October 2014, Ford sent 

an unsolicited $8.45 million check to Versata’s corporate offices in Texas for a oneyear ACM license renewal, even though Versata had rejected this proposal just days 

earlier. Ford also sent two unsolicited purchase orders to Versata’s corporate offices 

based on this same proposal that Versata had rejected. 

These tactics – apparently intended to prompt someone at Versata to create a 

binding contract by cashing the check or executing one of the purchase orders –

show that Ford was not prepared to terminate its license to ACM at the beginning of 

2015. Significantly, Ford also refused to allow Versata to review its TCM software 

or documentation as part of a contract audit process, stonewalling Versata’s efforts 

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to determine the full extent to which TCM incorporates its trade secrets, copyrights,

and patented technologies.

For these reasons, and as further stated below, it is apparent that Ford is liable 

for breaching its software license agreements with Versata, misappropriating 

Versata’s trade secrets, and infringing Versata’s patents and copyrights. 

PARTIES

1. Versata lacks knowledge or information sufficient to form a belief 

about the truth of the allegations contained in this paragraph, and on that basis denies 

them.

2. Admitted.

3. Versata admits that Trilogy Development Group, Inc.’s principal place 

of business is in Austin, TX. Versata denies the remaining allegations in this 

paragraph.

4. Admitted.

5. Admitted.

JURISDICTION AND VENUE

6. Versata incorporates by reference the allegations in paragraphs 1-5 of 

its Answer, and to the extent an answer is required, denied. 

7. Admitted that this Court has subject matter jurisdiction over this action 

pursuant to 28 U.S.C. §§ 1331, 1338, and 2201; otherwise denied.

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8. Versata lacks knowledge or information sufficient to form a belief 

about the truth of the allegations contained in this paragraph, and on that basis denies 

them.

9. Denied.

BACKGROUND FACTS

10. Versata incorporates by reference the allegations in paragraphs 1-9 of 

its Answer, and to the extent an answer is required, denied. 

11. The term “Original Equipment Manufacturer” is undefined; Versata 

lacks knowledge or information sufficient to form a belief about the truth of the 

allegations contained in this paragraph, and on that basis denies them.

12. Versata admits that Ford sells vehicles with many different

configurations. Versata lacks knowledge or information sufficient to form a belief 

about the truth of the remainder of the allegations contained in this paragraph, and 

on that basis denies them.

13. Admitted. 

14. Admitted to the extent that these allegations are not intended to 

preclude that billions of configurations may be possible for a vehicle line; otherwise 

denied. 

15. Versata lacks knowledge or information sufficient to form a belief 

about the truth of the allegations contained in this paragraph, and on that basis denies 

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them.

16. Versata admits that Ford licensed software from Versata in October 

1998; otherwise denied.

17. Versata admits that it entered into a Contract Services Agreement 

(“CSA”) with Ford in 1998. For all other allegations herein, lacks knowledge or 

information sufficient to form a belief about the truth of the allegations contained in 

this paragraph, and on that basis denies them.

18. Versata admits that the CSA speaks for itself. Versata denies any 

allegation that is inconsistent with the terms of the CSA. Versata denies the 

remaining allegations.

19. Denied.

20. Versata admits that Ford’s vehicle offerings required high levels of data 

volumes and complexity; otherwise denied. 

21. Denied. 

22. Versata admits that it entered into a Master Subscription and Services 

Agreement (“MSSA”) with Ford in 2004 and that the MSSA speaks for itself. 

Versata denies any allegation that is inconsistent with the terms of the MSSA. 

Versata denies the remaining allegations.

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23. Versata admits that the MSSA speaks for itself. Versata denies any 

allegation that is inconsistent with the terms of the MSSA. Versata denies the 

remaining allegations.

24. Denied.

25. Denied.

26. Denied.

27. Versata admits that it entered into an additional license agreement with 

Ford. Otherwise, denied.

28. Versata admits that Ford paid Versata pursuant to the additional 

agreement. Otherwise denied.

29. Versata admits that it sent a letter to Ford dated October 7, 2014, and 

that the letter speaks for itself; otherwise denied.

30. Versata admits that it sent a letter to Ford dated November 13, 2014, 

and that the letter speaks for itself; otherwise denied.

31. Denied.

32. Denied

33. Denied.

34. Denied.

35. Versata admits that a Ford employee stated orally that Ford planned to 

replace ACM software. Otherwise, denied.

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36. Versata lacks knowledge or information sufficient to form a belief 

about the truth of the allegations contained in this paragraph, and on that basis denies 

them.

37. Versata lacks knowledge or information sufficient to form a belief 

about the truth of the allegations contained in this paragraph, and on that basis denies 

them.

38. Versata lacks knowledge or information sufficient to form a belief 

about the truth of the allegations contained in this paragraph, and on that basis denies 

them.

39. Denied.

40. Versata lacks knowledge or information sufficient to form a belief 

about the truth of the allegations contained in this paragraph, and on that basis denies 

them.

41. Denied.

42. Versata lacks knowledge or information sufficient to form a belief 

about the truth of the allegations contained in this paragraph, and on that basis denies 

them.

43. Versata admits that the United States Patent and Trademark Office 

(USPTO) issued Patent No. 8,812,375 in August 2014; otherwise denied.

44. Denied.

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45. Denied.

46. Denied.

47. Denied.

48. Denied.

49. Denied.

50. Denied.

51. Versata lacks knowledge or information sufficient to form a belief 

about the truth of the allegations contained in this paragraph, and on that basis denies 

them.

52. Denied.

53. Denied.

54. Versata admits that it sent a letter to Ford dated October 7, 2014, and 

that the letter speaks for itself; otherwise denied.

55. Versata admits that some of its representatives met with Ford 

representatives in Dearborn on December 19, 2014; otherwise denied. 

56. Versata admits that it has notified Ford of its intent to exercise its onpremises audit rights pursuant to the MSSA. Otherwise denied.

57. Versata admits that it requested interviews with Ford personnel 

pursuant to its on-premises audit rights under the MSSA. Otherwise denied.

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58. Versata admits that it holds the following patents: U.S. Patent No. 

5,825,651 (the ‘651 Patent) (incorrectly identified in Ford’s Complaint as the “‘561 

Patent”), U.S. Patent No. 6,405,308 (the ‘308 Patent), and U.S. Patent No. 6,675,294 

(the ‘294 Patent). Versata also admits that the claims of these patents cover aspects 

of ACM. Otherwise, denied. 

59. Versata’s October 7, 2014 letter speaks for itself. Otherwise, denied.

60. The context for the allegations in this are paragraph is vague. 

Accordingly, Versata lacks knowledge or information sufficient to form a belief 

about the truth of the allegations contained in this paragraph, and on that basis denies 

them.

COUNT #1:

(Declaratory Judgment That Ford Does Not Infringe The ‘651 Patent)

61. Versata incorporates by reference the allegations in paragraphs 1-60 of 

its Answer, and to the extent an answer is required, denied.

62. Denied.

63. Denied.

64. Denied.

COUNT #2:

(Declaratory Judgment That Ford Does Not Infringe The ‘308 Patent)

65. Versata incorporates by reference the allegations in paragraphs 1-64 of 

its Answer, and to the extent an answer is required, denied.

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66. Denied.

67. Denied.

68. Denied.

COUNT #3:

(Declaratory Judgment That Ford Does Not Infringe The ‘294 Patent)

69. Versata incorporates by reference the allegations in paragraphs 1-68 of 

its Answer, and to the extent an answer is required, denied.

70. Denied.

71. Denied.

72. Denied.

COUNT #4:

(Declaratory Judgment That Ford Owns, Or Is Licensed To Reproduce, 

Software Trilogy Developed Pursuant To The 1998 Contract Services 

Agreement) 

73. Versata incorporates by reference the allegations in paragraphs 1-72 of 

its Answer, and to the extent an answer is required, denied.

74. Denied.

75. Versata admits that Versata and Ford entered into the CSA in October 

1998 and that the CSA speaks for itself; otherwise denied. 

76. Denied.

77. Denied.

78. Denied.

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COUNT #5:

(Declaratory Judgment That Ford Owns, Or Is Licensed To Reproduce, 

Software Versata Developed Pursuant to the 2004 Master Subscription and 

Services Agreement) 

79. Versata incorporates by reference the allegations in paragraphs 1-78 of 

its Answer, and to the extent an answer is required, denied.

80. Denied.

81. Versata admits that Versata and Ford entered into the MSSA in 

December 2004 and that the MSSA speaks for itself; otherwise denied. 

82. Denied.

83. Denied.

84. Denied.

COUNT #6:

(Declaratory Judgment That Ford Did Not Misappropriate Defendants’ 

Trade Secrets) 

85. Versata incorporates by reference the allegations in paragraphs 1-84 of 

its Answer, and to the extent an answer is required, denied.

86. Denied.

87. Denied.

88. Denied.

89. Denied.

90. Denied.

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COUNT #7:

(Declaratory Judgment That Defendants Are Not Permitted To Inspect Ford’s 

PDO Software Or Interview Ford’s PDO Developers Pursuant To The Audit 

Provisions of the 2004 MSSA) 

91. Versata incorporates by reference the allegations in paragraphs 1-90 of 

its Answer, and to the extent an answer is required, denied.

92. Denied.

93. Versata admits that it requested to interview Ford personnel, otherwise 

denied. 

94. Denied.

95. Denied.

96. Denied.

97. Denied.

98. Denied.

99. Versata admits that Versata representatives met with Ford 

representatives in Dearborn on December 19, 2014; otherwise denied. 

100. Denied.

101. Denied.

COUNT #8:

(Breach of Contract) 

102. Versata incorporates by reference the allegations in paragraphs 1-101 

of its Answer, and to the extent an answer is required, denied.

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103. Denied.

104. Denied.

105. Denied.

106. Denied.

107. Denied.

108. Denied.

109. Denied. 

COUNT #9

(Declaratory Judgment Of Invalidity Of U.S. Patent No. 5,825,651)

110. Versata incorporates by reference the allegations in paragraphs 1-109 

of its Answer, and to the extent an answer is required, denied.

111. Denied.

COUNT #10

(Declaratory Judgment Of Invalidity of U.S. Patent 6,405,308)

112. Versata incorporates by reference the allegations in paragraphs 1-111 

of its Answer, and to the extent an answer is required, denied.

113. Denied.

COUNT #11

(Declaratory Judgment Of Invalidity of U.S. Patent 6,675,294)

114. Versata incorporates by reference the allegations in paragraphs 1-113 

of its Answer, and to the extent an answer is required, denied.

115. Denied.

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COUNT #12

(Declaratory Judgment Of Invalidity of U.S. Patent 8,805,825)

116. Versata incorporates by reference the allegations in paragraphs 1-115 

of its Answer, and to the extent an answer is required, denied.

117. Denied.

COUNT #13

(Declaratory Judgment Of Invalidity of U.S. Patent 7,200,582)

118. Versata incorporates by reference the allegations in paragraphs 1-117 

of its Answer, and to the extent an answer is required, denied.

119. Denied.

COUNT #14

(Declaratory Judgment Of Invalidity of U.S. Patent 7,739,808)

120. Versata incorporates by reference the allegations in paragraphs 1-119 

of its Answer, and to the extent an answer is required, denied.

121. Denied.

COUNT #15

(Declaratory Judgment Of Invalidity of U.S. Patent 7,464,064)

122. Versata incorporates by reference the allegations in paragraphs 1-121

of its Answer, and to the extent an answer is required, denied.

123. Denied.

COUNT #16

(Declaratory Judgment Of Invalidity of U.S. Patent 7,882,057)

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124. Versata incorporates by reference the allegations in paragraphs 1-123 

of its Answer, and to the extent an answer is required, denied.

125. Denied.

COUNT #17

(Breach of Contract)

126. Versata incorporates by reference the allegations in paragraphs 1-125 

of its Answer, and to the extent an answer is required, denied.

127. Admitted that Trilogy Software, Inc. and Ford entered into a contract

entitled “Software Subscription Amendment”; otherwise denied.

128. Admitted that in December 2004, Ford and Trilogy Software, Inc.

entered into the Master Subscription and Services Agreement (“MSSA”); otherwise

denied.

129. Admitted that Versata denies that the MSSA completely superseded the

SSA, and Versata asserts claims against Ford based on certain terms of the SSA;

otherwise denied.

130. Denied.

131. Versata admits that the terms of the SSA speak for themselves. To the 

extent any further response is required, Versata denies the remaining allegations of 

this paragraph.

132. Versata admits that at least one non-Ford company is currently paying 

Versata license fees for ACM; otherwise denied.

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133. Denied

COUNT #18

(Inequitable Conduct)

134. Versata incorporates by reference the allegations in paragraphs 1-133 

of its Answer, and to the extent an answer is required, denied.

135. Denied.

136. U.S. Patent No. 5,825,651 speaks for itself; otherwise denied.

137. U.S. Patent No. 5,825,651 speaks for itself; otherwise denied.

138. Denied.

139. Versata admits that it has marketed a product named SalesBUILDER; 

otherwise denied.

140. Denied.

141. Versata lacks knowledge or information sufficient to form a belief 

about the truth of the allegations contained in this paragraph, and on that basis denies

them.

142. Denied.

143. Versata lacks knowledge or information sufficient to form a belief 

about the truth of the allegations contained in this paragraph, and on that basis denies

them.

144. Admitted that graphic shown in this paragraph is from Figure 2 of the

‘651 patent; otherwise denied.

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145. Admitted that the ’651 patent application was filed September 3, 1996; 

otherwise denied.

146. Denied.

147. Denied.

148. Denied.

149. Denied.

150. Denied.

151. Denied.

152. Denied.

153. Denied.

154. Denied.

155. Denied.

156. Denied.

157. Denied.

158. 37 C.F.R. 1.56 speaks for itself; otherwise denied.

159. Denied.

160. Versata admits Mr. J.D. Harriman II is a patent attorney who prosecuted 

U.S. Patent Nos. 5,825,651; 5,515,524; and 5,708,798. Versata also admits that it 

contends that some claims of U.S. Patent Nos. 5,515,524, and 5,708,798 may cover 

certain aspects of SalesBuilder; otherwise, denied.

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161. Versata admits that Mr. Ajay Agarwal is an inventor of U.S. Patent No. 

5,825,651 and that Mr. Agarwal was employed by Trilogy; otherwise denied.

162. Versata admits that Dr. David Franke is an inventor of U.S. Patent Nos. 

5,515,524, and 5,708,798 and was employed by Trilogy; otherwise denied.

163. Denied.

164. Denied.

RELIEF REQUESTED

WHEREFORE, the Versata Defendants deny the allegations in the Prayer for 

Relief and any other allegations of the Second Amended Complaint not specifically 

responded to herein, and respectfully pray for the following relief:

A. That the Court deny Ford’s request for declaratory judgment, and 

otherwise dismiss Ford’s Complaint with prejudice. 

B. That the Court provide for a trial by jury on all issues triable by jury.

C. That the Court award Versata its attorney’s fees and costs in connection 

with this action.

D. That the Court award such other and further relief in law or in equity to 

which Versata may be justly entitled. 

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Respectfully submitted,

AHMAD, ZAVITSANOS, ANAIPAKOS, ALAVI 

& MENSING P.C.

 /s/ Steven J. Mitby

Steven J. Mitby

Texas State Bar No. 24037123

smitby@azalaw.com

Iftikhar Ahmed

Texas State Bar No. 24064795

iftiahmed@azalaw.com

Foster C. Johnson

Texas State Bar No. 24076463

fjohnson@azalaw.com

Reed N. Smith

Texas State Bar No. 24067875

rsmith@azalaw.com

AHMAD, ZAVITSANOS, ANAIPAKOS, ALAVI &

MENSING, P.C.

1221 McKinney, Suite 2500

Houston, Texas 77010

(713) 655-1101 (Phone)

(713) 655-0062 (Fax)

YOUNG & ASSOCIATES

/s/ Rodger D. Young

Rodger D. Young (P22652)

27725 Stansbury Blvd., Suite 125

Farmington Hills, MI 48334

248.353.8620

efiling@youngpc.com 

COUNSEL FOR DEFENDANTS 

AFFIRMATIVE AND SPECIAL DEFENSES

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1. Ford’s claims for breach of contract are precluded by its ratification of 

Versata’s actions.

2. Ford’s claims for breach of contract are precluded because Ford and 

Versata entered into a novation and accord.

3. Ford’s claims for breach of contract are precluded because of Ford’s 

waiver.

4. All of Ford’s claims are barred because Ford has failed to state a claim 

for which relief can be granted.

5. All of Ford’s claims are barred by the doctrine of unclean hands.

6. Ford’s claims for breach of contract are barred because, even if it could 

show Versata breached the MSSA, Ford materially breached the MSSA first.

7. Ford’s claims for breach of contract are barred by estoppel and/or 

consent. 

Respectfully submitted,

AHMAD, ZAVITSANOS, ANAIPAKOS, ALAVI 

& MENSING P.C.

 /s/ Steven J. Mitby

Steven J. Mitby

Texas State Bar No. 24037123

smitby@azalaw.com

Iftikhar Ahmed

Texas State Bar No. 24064795

iftiahmed@azalaw.com

Foster C. Johnson

Texas State Bar No. 24076463

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fjohnson@azalaw.com

Reed N. Smith

Texas State Bar No. 24067875

rsmith@azalaw.com

AHMAD, ZAVITSANOS, ANAIPAKOS, ALAVI &

MENSING, P.C.

1221 McKinney, Suite 2500

Houston, Texas 77010

(713) 655-1101 (Phone)

(713) 655-0062 (Fax)

YOUNG & ASSOCIATES

/s/ Rodger D. Young

Rodger D. Young (P22652)

27725 Stansbury Blvd., Suite 125

Farmington Hills, MI 48334

248.353.8620

efiling@youngpc.com 

COUNSEL FOR DEFENDANTS 

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VERSATA PARTIES’ SECOND AMENDED 

COUNTERCLAIMS AGAINST FORD

Versata incorporates by reference Defendants’ First Amended Answer to 

Plaintiff’s Complaint Filed In Case No. 15-11624, Affirmative and Special 

Defenses, and Reliance on Jury Demand (Dkt. 92). Versata’s Counterclaims 

previously filed in Case No. 15-11624 are incorporated below in this pleading. 

JURISDICTION AND VENUE

1. This is an action for patent infringement under the Patent Laws of the 

United States, 35 U.S.C. § 271.

2. This Court has subject matter jurisdiction pursuant to 28 U.S.C. 

§§ 1331 and 1338(a). This Court also has supplemental jurisdiction pursuant to 28 

U.S.C. §§ 1367, 1338(b).

3. Venue is proper in this judicial district under 28 U.S.C. §§ 28 U.S.C. 

1391(b) and (c).

PARTIES

4. These counterclaims are asserted by Defendants against Plaintiff Ford 

Motor Company.

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FACTUAL ALLEGATIONS

A. Ford licenses Versata’s configuration software for 17 years

5. Versata realleges and incorporates by reference herein the allegations 

in the foregoing paragraphs, including the Preliminary Statement contained in its 

Answer.

6. Versata is an enterprise software company. Versata develops some of 

the most successful, sophisticated, and powerful enterprise software in the United 

States. One of Versata’s key areas of innovation is automotive configuration 

technologies, a field in which Versata holds multiple patents. 

7. Versata and its subsidiaries have developed software comprised of 

technical data, formulas, patterns, compilations, programs, and other patented, trade 

secret, and copyrighted information for the purpose of assisting automotive 

manufacturers in designing and configuring automotive product lines as well as 

financially forecasting costs and profits.

8. From at least October 1998 until January 2015, Ford licensed Versata’s 

technology – including Versata’s Automotive Configuration Manager (“ACM”), 

Material Cost Analytics (“MCA”), and Automotive Configuration Services (“ACS”)

– pursuant to two master agreements that included multiple schedules and addenda.

9. In 1998, Ford signed a contract services software licensing agreement 

with Versata (the “CSA”), which permitted Ford to license Versata’s automotive 

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configuration software in return for an annual licensing fee. A true and correct copy 

of the CSA is attached hereto as Exhibit 1.

10. The CSA specified that, except for certain custom portions to which 

Ford was specifically assigned ownership in written assignment orders, Versata 

“retain[ed] all rights, title and interest in and to the software and/or related 

documentation provided to [Ford] by [Versata], including, without limitation, the 

Non-Custom Elements ... and all copyright, trade secret and other rights relating 

thereto.” (Ex. 1 at 2).

11. Ford also acknowledged in the CSA that “the ‘Non-Custom Elements’ 

include[d] ... the know-how, technique, concepts, methods, coding, designs, 

inventions, procedures or other subject matter of the Developed Software, whether 

or not included in the Custom Portions, if such subject matter is not specific to, or 

can be made nonspecific to, [Ford].” (Ex. 1 at 3).

12. Ford further agreed to “restrict access to [Trilogy’s] Confidential 

Information only to owners, employees, and contractors who (i) require access in the 

course of their assigned duties and responsibilities, and (ii) have agreed in writing to 

be bound by provisions no less restrictive than those set forth in [the CSA].” (Ex. 1

at 3).

13. By late 2001, Versata had licensed to Ford a version of software 

technology that would become known as Versata’s “Automotive Configuration 

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Manager” (“ACM”). Ford had also licensed software for Ford’s retail website, 

Ford.com (which is different from the ACM technology). In addition, Versata also 

was providing Ford with consulting services to implement the Ford.com software. 

14. In 2001, while negotiating the terms of a new license agreement, Ford 

and Versata reached two key areas of disagreement. First, Ford asserted ownership 

claims in the ACM technology and the Ford.com software. Versata strongly 

disputed Ford’s claims of ownership, especially with regard to ACM, which Versata 

was in the process of marketing to other automotive companies. Second, Ford had 

refused to pay almost $1.8 million in consulting invoices for work Versata 

performed on the Ford.com software. Versata contended that it had provided these 

services to Ford and considered this debt as past-due. Given the ongoing business 

relationship between the two companies, however, Versata was willing to negotiate 

a settlement.

15. In January 2002, Ford and Versata agreed to resolve their disputes and 

memorialized their settlement in the January 1, 2002 Software Subscription 

Amendment (“SSA”). The SSA was a settlement agreement that resolved existing 

legal disputes and it contains a full mutual release of liability for past claims. A true 

and correct copy of the SSA is attached hereto as Exhibit 17.

16. In the SSA, Ford obtained four key benefits: (1) a new subscription 

license to use Versata’s ACM software in its worldwide business—albeit a license 

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which would “cease immediately upon termination of this Amendment and/or the 

Agreement”; (2) reduction of Versata’s outstanding consulting invoices by almost 

$900,000; (3) retention of the right to use ACM throughout its worldwide business—

likely saving billions of dollars over the following thirteen years; and (4) a broad 

release of liability from Versata for any past claims.

17. In exchange, Ford agreed to “provide reasonable assistance in 

perfecting and protecting GPD Software intellectual property for Trilogy” (which 

was Versata’s name at the time). Exhibit A to the SSA specifically defines this 

“GPD Software” as version 3.2 of ACM. Ford also agreed to assist Versata in 

marketing ACM to other automotive companies (evidencing that, contrary to Ford’s 

claims in this case, ACM was a marketable product and was not custom-developed 

for Ford). Ford reaffirmed its commitment to protect Versata’s intellectual property 

in at least five agreements following the SSA. 

18. In 2004, Ford and Versata entered into a second comprehensive license 

agreement for use of Versata’s technology, including ACM, MCA, and ACS. Like 

the earlier software that Ford licensed from Versata, the technology was developed 

by Versata, which then licensed this propriety technology to Ford.

19. In December 2004, Ford and Versata entered into a Master Subscription 

and Services Agreement (“MSSA”), governing Ford’s licensing of the Versata’s 

proprietary technology, including MCA, ACM, and ACS. A true and correct copy 

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of the MSSA is attached hereto as Exhibit 6.

20. Like the CSA, the MSSA granted Ford a license to use Versata’s 

proprietary software, including ACM, MCA, and ACS. It did not, however, grant 

Ford any ownership rights in this software or the underlying technology. While Ford 

owned the rights to certain minor customizations of the software, it did not own the 

underlying technology. Versata’s ACM software was the engine that drove Ford’s 

entire configuration process. And just as a Ford Taurus would not run without a 

Ford engine, Ford’s configuration and financial forecasting systems would not run 

without Versata’s ACM software.

21. The MSSA made plain that Versata retained all rights to its proprietary

technology, including ACM, MCA, and ACS.

22. For example, in Section 6 (“Ownership”), the MSSA specifically 

provides that “[b]y signing this Agreement, Ford irrevocably acknowledges that, 

subject to the licenses granted herein, Ford has no ownership interest in the Software,

Deliverables that are owned by [Versata] pursuant to Section 1.8, or [Versata] 

Materials provided to Ford.”].” (Ex. 6 at 5).

23. The MSSA further specified in Section 7.4 (“Ownership of 

Confidential Information”) that “[n]othing in this Agreement shall be construed to 

convey any title or ownership rights to the Software or other [Versata] Confidential 

Information to Ford or to any patent, copyright, trademark, or trade secret embodied 

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therein, or to grant any other right, title, or ownership interest to the [Versata] 

Confidential Information.” (Ex. 6 at 5).

24. The MSSA also contained a number of additional safeguards to protect 

Versata’s Confidential Information.

25. Like the CSA, Ford agreed in Section 7.5 that it would “at all times use 

Reasonable Care in preventing the disclosure of Confidential Information belonging 

to [Versata].” Ford further agreed “to restrict access to [Versata’s] Confidential 

Information only to those employees and third-party contractors or agents who (i) 

require access in the course of their assigned duties and responsibilities and (ii) have 

agreed in writing to be bound by provisions no less restrictive than those set forth in 

the [MSSA].” (Ex. 6 at 5).

26. Ford agreed in Section 1.7 that “[i]n no event shall Ford disassemble, 

decompile, or reverse engineer [Versata’s] Software or Confidential Information ... 

or permit others to do so.” (Ex. 6 at 2).

27. Ford also agreed that “Ford may use [Versata’s] Confidential 

Information solely in connection with the Software and pursuant to the terms of this 

Agreement.” (Ex. 6 at 2).

28. In order to ensure that Ford would comply with the restrictions on its 

use of Versata’s Confidential Information, Versata negotiated the right to conduct 

verification audits at Ford.

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29. Under Section 3.5 of the MSSA, Ford agreed that “[Versata] may, upon 

thirty (30) days prior written notice, enter Ford’s premises to verify Ford’s 

compliance with the provisions of this Agreement at [Versata]’s expense.” (Ex. 6 at 

4).

30. Ford also agreed in Section 12 (“Ford Obligations”) that “Ford [would] 

upon reasonable request, reasonably make available to [Versata] certain of its 

facilities, computer resources, software programs, networks, personnel, and business 

information as are required to perform any Work, service, or other obligation 

hereunder.” (Ex. 6 at 7).

31. Finally, the MSSA provides in Section 1.3 that, unless it was terminated 

by one of the parties, the license agreement would “automatically renew for 

successive twelve-month periods (“Annual Renewal Periods”) upon issuance of a 

valid Ford purchase order to Versata. (Ex. 6at 1.3).

32. Between 1998 and 2015, Versata and its corporate parent, Trilogy, 

provided configuration software, technical documentation, and limited amounts of 

source code to Ford. 

33. Through this process, Versata disclosed certain trade secret and other 

confidential information that it developed and owns, including its proprietary 

technology for configuring, designing, pricing, and comparing vehicles (the 

“Confidential Information”), pursuant to the terms of a series of agreements between 

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Ford and Trilogy.

B. Ford becomes dependent on Versata’s technology

34. Versata’s ACM proved immensely valuable to Ford. The ACM 

technology allowed engineers and marketing agents from Ford’s facilities across the 

world to collaborate and design Ford vehicles with seamless real time updates. The 

Versata software, including ACM, MCA, and ACS, also allowed Ford’s financial 

managers to forecast pricing and demand with hitherto unrivaled accuracy and 

precision.

35. Versata’s ACM technology was so powerful that Ford rapidly adopted 

Versata’s propriety software and integrated the software throughout its worldwide 

business.

36. Much like Microsoft Office or Adobe Acrobat, Versata’s ACM 

software rapidly became embedded across Ford’s global technology platform. Ford 

became so dependent on Versata that it could not manufacture or sell a single vehicle 

without Versata’s ACM technology.

37. Versata’s ACM technology revolutionized Ford’s business practices, 

and saved Ford at least hundreds of millions of dollars. But Ford’s cost to license 

this technology was relatively low in comparison to the cost-savings and other 

benefits it provided. Beginning in 2004, Ford paid Versata an $8.45 million annual 

license fee—a license fee that remained unchanged over the next decade. But even 

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this $8.45 million annual license fee was more than Ford wanted to pay.

C. Ford seeks to eliminate its dependence on Versata by copying ACM

38. In 2011, weary of the annual cost of licensing Versata’s software, Ford 

began an internal project to replace Versata’s software, including ACM and MCA, 

and develop software that would perform the same functions. The objective of this 

project was to develop a complete replacement for Versata’s software. Initially, 

Ford even mimicked the ACM name, calling its project “Total Configuration 

Management” (‘TCM’), before later changing the name to “Product Definition and 

Offer” (‘PDO’).

39. TCM—like ACM—is used to configure vehicles from billions of 

possible combinations of parts, features, and options. When a Ford dealer attempts 

to place an order through Ford’s Web Based Dealer Ordering (“WBDO”) system—

for example, an order for 250 Ford Mustangs in different colors with sunroofs and 

20 inch wheels—TCM supplies the “rules” that ensure configuration results in an 

integrated, working vehicle system that Ford is able to manufacture and sell. 

Likewise, when a retail customer attempts to customize a Ford F-150 pickup using 

Ford.com, TCM ensures that the customer is only able to select options that Ford 

could build. 

40. Because TCM is the only software that Ford uses for vehicle 

configuration, Ford has integrated TCM with a multitude of software programs that 

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require valid, up-to-date vehicle configuration data. Those programs include Ford’s 

dealer ordering systems, retail website, sales and marketing systems, engineering 

systems, and manufacturing systems. 

41. All of these systems depend upon accurate and current vehicle 

configuration data so Ford can build, market, and sell functional vehicles. Without 

access to TCM, these other Ford software systems would be useless because they 

would not have access to valid vehicle configuration data. These programs receive 

regular data updates from TCM, often on a daily basis. In fact, the whole purpose 

of TCM is to provide the configuration backbone for other software programs, which 

Ford uses on a nationwide and worldwide basis.

42. On information and belief, Ford breached its obligations to Versata by 

reverse engineering Versata’s patented and copyrighted software and disseminating 

Versata’s Confidential Information to unauthorized users tasked with creating a 

copycat configuration technology.

43. At no time between 2011 and 2014, did Ford inform Versata that its 

engineers were developing a rival configuration software. On October 7, 2011, Ford 

filed a patent application on technologies that it admits to using in its rival 

configuration software. In August 2014, Ford received a patent covering this 

“invention,” U.S. Patent No. 8,812,375 (the ‘375 patent). A true and correct copy 

of the ‘375 patent is attached hereto as Exhibit 7.

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44. Inventors on the ‘375 patent include Bryan Goodman and Gintaras 

Puskorius, both of whom had access to Versata configuration technologies. 

Numerous aspects of the ‘375 patent are based on Versata patented technologies and 

trade secrets. 

45. On March 15, 2013, Ford filed another patent application which was 

published as U.S. Patent Publication No. US20140279602. This also describes 

configuration technologies used in TCM. A true and correct copy of the ‘602 

publication is attached hereto as Exhibit 8.

46. Inventors on the ‘602 publication include Bryan Goodman, Jian Lin, 

James Beardslee, Ganesh Alla, Ravi Kundoor, Gintaras Puskorius, Yakov Fradkin, 

and Martin Pipoly, all of whom had access to Versata configuration technologies. 

Numerous aspects of the ‘602 publication are based on Versata patented 

technologies and trade secrets. 

47. Similarly, Ford copied Versata’s proprietary MCA Software. MCA is 

Versata’s proprietary software and, among other things, assists Ford in forecasting 

demand and need for product features and related parts. Ford personnel examined 

Versata’s MCA software and created copycat software which was later incorporated 

into Ford’s PDO program. On information and belief, Ford’s copycat replacement 

for MCA is called “MCA 4.0.”

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D. Ford attempts to renew its ACM license through subterfuge

48. In 2014, Ford and Versata began negotiating a renewal of the ACM 

software license.

49. During the negotiations, Versata informed Ford that it was unwilling to 

extend the software licensing agreement without an increase in the annual licensing 

fee. To facilitate negotiations, Versata made a number of proposals, including a 

proposal that Ford could license all of its major software products, including the 

ACM software, for a single $17 million a year annual license fee. 

50. Ford refused to negotiate with Versata. Instead, Ford attempted to 

renew the license under the old terms through subterfuge.

51. In fall 2014, Ford sent a check for $8.45 million to Versata’s accounting 

department, apparently in the hope that Versata would knowingly—or 

unknowingly—cash the check and renew the ACM license. Versata returned the 

check to Ford.

52. When Ford’s initial scheme failed, it then attempted to renew the ACM 

license by submitting purchase orders through both its European and American 

offices requesting renewal of the “2015 ACM License.” Versata rejected those 

purchase orders as well.

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E. Versata terminates Ford’s ACM license

53. Finally, on October 7, 2014, with no deal in sight and facing an 

automatic renewal of the license agreement if it did not act, Versata was forced to 

notify Ford in writing that it was terminating the existing license agreement as of 

January 15, 2015. Versata also notified Ford that, pursuant to Section 11.4 of the 

MSSA, Ford was “required to cease using all ... Versata Software and Materials ... 

and return the same to Versata or destroy all such Versata Software and Materials 

and Confidential Information from all Ford systems, records or repositories.”

54. In the hope that the parties could reach an agreement, Versata continued 

to negotiate with Ford. But Ford refused to pay any increase for its use of the ACM 

license—despite the fact that it had enjoyed the same (now heavily discounted) price 

for a decade. 

55. By November 2014, Versata became concerned that Ford intended to 

breach the MSSA by continuing to use Versata’s software, including ACM, without 

paying any licensing fees. To address this concern, Versata sent Ford a letter on 

November 20, 2014 informing Ford that Versata intended to conduct visit Ford’s 

facilities “to verify your compliance with the terms of the Agreement concerning 

your deletion [of the ACM software] and return of all of the ... Software, the licenses 

of which have been terminated and all the materials related to such terminated 

Software.” But, in breach of the parties’ contract, Ford refused to allow Versata to 

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visit its facilities, speak with its employees, or conduct the audit that Ford had 

specifically agreed to in sections 3.5 and 12.2 of the MSSA.

F. Ford falsely claims that it implemented a “Chinese wall”

56. On December 19, 2014, Versata met with Ford management at the Ford 

headquarters in Michigan. At that meeting, Ford informed Versata that they were 

terminating the ACM software license. Ford further informed Versata for the first 

time that Ford was switching to its own, newly developed configuration software.

57. During this December 19, 2014 meeting Ford further claimed that it had 

put a “Chinese Wall” in place to ensure that people who had access to Versata’s 

software did not work on, or use the trade secrets in, the replacement software. But 

when asked who was in charge of this replacement project, Ford conceded that it 

was Mike Sullivan, a manager who had supervised Ford employees working on 

ACM for more than a decade. Versata subsequently discovered that at least 26

individuals who used, or had access to, Versata software worked on TCM. These 

individuals included Bryan Goodman, Gintaras Puskorius, Kurt Reinke, Sanjay 

Sisale, Ram Pillarisetty, Garghi Shah, David Wierzbicki, Sunil Gajula, Manisha 

Tambe, Darlene Coomer, Jian Lin, Fred Wilkinson, Linda Wu, Rachel Sims, Chris 

Andrews, Martin Pipoly, Yakov Fradkin, Jim Beardslee, Ravi Kundoor, Ganesh 

Alla, Erin Jasso, Aaron Bush, Rachel Smith, Sai Viswanatha, Colin Shury, and Mike 

Sullivan. 

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58. During the development of Ford’s replacement software, Ford allowed 

numerous employees and third-party contractors to have access to Versata’s 

Software and Confidential Information without agreements in writing to abide by 

the confidentiality provisions of Section 7 of the MSSA.

G. Ford refuses to let Versata verify its compliance with its software license 

59. Following the termination of Ford’s licenses, Versata exercised its 

contractual right to request an on-premises verification to confirm whether Ford was

still using unlicensed Versata software or had incorporated software components or 

trade secrets into TCM. When Ford refused, Versata requested that Ford put its 

position in writing. Instead, on February 19, 2015, Ford filed the present lawsuit 

seeking a declaratory judgment that its new, copycat configuration software did not 

infringe Versata’s patents or otherwise reflect that Ford had stolen Versata’s 

Confidential Information.

60. On information and belief, Ford has misappropriated Versata’s 

Confidential Information and continues to use Versata’s patented and copyrighted 

software in violation of the MSSA, including in its use of TCM, MCA 4.0, and its 

“super configurator.”

61. The Confidential Information includes specific trade secrets from 

which Ford derives, and has derived, significant value and competitive advantage. 

Versata has treated the Confidential Information as confidential and restricted 

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information, and have taken reasonable steps to protect such Confidential 

Information from unauthorized use or disclosure to maintain its secrecy. The 

Confidential Information was developed by Versata at great expense, and constitutes 

valuable trade secrets that give Ford a competitive advantage over others in its 

industry.

62. Ford was—and continues to be—under an obligation not to disclose, 

claim, and/or use as their own, the Confidential Information disclosed by Versata.

H. Ford is liable for breaching its license agreements with Versata, for trade 

secret misappropriation, and for patent infringement

63. Versata is informed and believes, and based thereon allege, that Ford 

violated its obligations with respect to the Confidential Information by misusing and 

misappropriating the Confidential Information within its companies and facilities for 

its personal gain. In addition, Ford disclosed the Confidential Information to third 

parties, including, but not limited to, the United States Patent and Trademark Office.

64. Versata did not become aware that Ford had violated its obligations not 

to misuse, misappropriate or disclose the Confidential Information until 

approximately February 19, 2015, when Ford filed its Complaint seeking declaratory 

relief for patent infringement and misappropriation of trade secrets. At that time, it 

became clear to Versata that Ford had misappropriated the Confidential Information, 

disclosed it, and converted it to Ford’s own use, in violation of Ford’s statutory and 

contractual obligations. Ford’s business is such that were Ford to misuse and 

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misappropriate Versata’s proprietary technology as alleged, Ford would (and 

Versata alleges Ford did) benefit from its misdeeds even if they never applied for, 

obtained or licensed any patents based on the technology. Versata is informed and 

believes that Ford continues to run major portions of its business operations based 

on its misuse and misappropriation of Versata’s proprietary technology.

65. On October 20, 1998, the USPTO duly and legally issued United States 

Patent No. 5,825,651 (the ‘651 patent), entitled “Method and Apparatus for 

Configuring Systems.” Versata holds all right, title, and interest in and to the ‘651 

patent (a true and correct copy of which is attached as Exhibit 9).

66. On June 11, 2002, the USPTO duly and legally issued United States 

Patent No. 6,405,308 (the ‘308 patent), entitled “Method and Apparatus for 

Maintaining and Configuring Systems.” Versata holds all right, title, and interest in 

and to the ‘308 patent (a true and correct copy of which is attached as Exhibit 10).

67. On January 6, 2004, the USPTO duly and legally issued United States

Patent No. 6,675,294 (the ‘294 patent), entitled “Method and Apparatus for 

Maintaining and Configuring Systems.” Versata holds all right, title, and interest in 

and to the ‘294 patent (a true and correct copy of which is attached as Exhibit 11).

68. On August 12, 2014 the USPTO duly and legally issued United States 

Patent No. 8,805,825 (the ‘825 patent), entitled “Method and Apparatus for 

Maintaining and Configuring Systems.” Versata holds all right, title, and interest in 

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and to the ‘‘825 patent (a true and correct copy of which is attached as Exhibit 12).

69. On April 3, 2007, the USPTO duly and legally issued United States 

Patent No. 7,200,582 (the ‘582 patent), entitled “Method and Apparatus for 

Maintaining and Configuring Systems.” Versata holds all right, title, and interest in 

and to the ‘582 patent (a true and correct copy of which is attached as Exhibit 13).

70. On June 15, 2010, the USPTO duly and legally issued United States 

Patent No. 7,739,080 (the ‘080 patent), entitled “Method and Apparatus for 

Maintaining and Configuring Systems.” Versata holds all right, title, and interest in 

and to the ‘080 patent (a true and correct copy of which is attached as Exhibit 14).

71. On December 9, 2008, the USPTO duly and legally issued United 

States Patent No. 7,464,064 (the ‘064 patent), entitled “Method and Apparatus for 

Maintaining and Configuring Systems.” Versata holds all right, title, and interest in 

and to the ‘064 patent (a true and correct copy of which is attached as Exhibit 15).

72. On February 1, 2011, the USPTO duly and legally issued United States 

Patent No. 7,882,057 (the ‘057 patent), entitled “Method and Apparatus for 

Maintaining and Configuring Systems.” Versata holds all right, title, and interest in 

and to the ‘057 patent (a true and correct copy of which is attached as Exhibit 16).

73. On March 15, 2013 Ford submitted patent application 13/840,497 to 

the USPTO, which was subsequently published as Pub. No. US2014/0279602 (the 

‘602 Publication). The ‘602 Publication’s abstract indicates that it relates to, among 

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other things, a “method or system identifying the one or more rules that provide a 

relationship connecting the one or more feature families of interest.” 

74. On information and belief, Ford makes, uses, licenses, sells, offers for 

sale, or imports in the State of Michigan, in this judicial district, and elsewhere 

within the United States, software, including Ford’s “super configuration 

technology” described in Ford’s Complaint for Declaratory Relief, that infringes the 

‘651, ‘308, ‘294, ‘528, ‘064, ‘825, ‘080, and ‘057 patents.

I. Ford’s patent infringement has been willful

75. Versata has attempted to put Ford on notice of its obligation to respect 

and not infringe Versata’s patents. Yet, despite having ample information that it is 

infringing, Ford willfully continues to infringe by using TCM.

76. Versata first put Ford on notice of its patent portfolio in an October 7, 

2014 letter to Ford. This letter, which Ford cited as a basis for its declaratory 

judgment action, specifically identifies the ‘651, ‘308, ‘294, ‘528, ‘064, ‘080, and 

‘057 patents as being embodied in Versata’s software. Versata’s letter further 

informed Ford that upon expiration of the current license, Ford was to discontinue 

use of all of these patented technologies.

77. Instead of doing so, Ford continued its efforts to launch and implement 

TCM, which Ford knows embodies all of these patented technologies. 

78. On February 18, 2015, Ford itself admitted to its actual knowledge and 

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awareness of Versata’s patent portfolio by citing the October 8, 2015 letter as a basis 

for its declaratory judgment action and by alleging that an actual case and 

controversy existed with respect to the ‘651, ‘308, and ‘294 patents.

79. On May 7, 2015, Versata sued Ford for patent infringement (among 

other causes of action) in the Eastern District of Texas and asserted claims under the 

‘651, ‘308, ‘294, ‘528, ‘064, ‘080, and ‘057 patents. This gave Ford the unmistakable 

message that Versata was serious about requiring Ford to respect its intellectual 

property. Yet Ford continues to infringe these patents.

80. Versata has taken steps to put Ford on notice of its infringement and 

Ford has had actual knowledge and awareness of the patents-in-suit. Moreover, 

because Ford copied Versata’s patented technologies for use in TCM, Ford has 

ample reason to believe that it is infringing and Ford’s infringement is therefore 

willful.

J. Ford Files Inter Partes Review Petitions on Six of the Eight Patents-in-Suit 

81. For the first sixteen months of this litigation, Ford did not take any 

offensive actions to invalidate Versata’s ACM-related patents. Ford did not assert 

any claims or counterclaims seeking a finding of invalidity. Ford also did not initiate 

any Patent Office proceedings to invalidate Versata’s patents. Ford only asserted 

affirmative defenses of invalidity, which are purely defensive in nature and related 

directly to Versata’s infringement claims this case. 

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82. On May 9, 2016, Ford filed Inter Partes Review (“IPR”) petitions 

seeking to have the Patent Office declare six of the eight patents-in-suit 

invalid. These IPR petitions are offensive attack on the validity of Versata’s ACMrelated patents, and once instituted by the Patent Office, cannot be dismissed at 

Ford’s discretion or by agreement between Ford and Versata. 

K. Versata has copyrights in its proprietary software

83. Versata is the exclusive legal owner of a valid and enforceable 

copyright in all versions of the software program Versata Automotive Configuration 

Manager (or “ACM”). ACM Version 4.24.13.00 is registered under TXu 1-937-

188, with an effective date of May 16, 2015; ACM version 02.02.16 is registered 

under TXu 1-937-354, with an effective date of May 7, 2015. ACM Version 1.0 is 

registered under TXu 2-017-880, with an effective date of December 14, 2016. A 

true and correct copy of the copyright registration certificates for Versata 

Automotive Configuration Manager are attached hereto as Exhibits 2, 3 and 4.

84. Versata is the exclusive legal owner of a valid and enforceable 

copyright in all versions of the software program Versata Automotive Configuration 

Services or (“ACS”), version 02.02.16 of which is registered under TXu 1-937-354, 

with an effective date of May 7, 2015. A true and correct copy of the copyright 

registration certificate for Versata Automotive Configuration Services is attached 

hereto as Exhibit 3.

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85. Versata is the exclusive legal owner of a valid and enforceable 

copyright in all versions of the software program Versata Material Cost Analytics

(“MCA”), version 02.02.14.01 of which is registered under TXu 1-937-185, with an 

effective date of May 6, 2015. A true and correct copy of the copyright registration 

certificate for Versata Material Cost Analytics is attached hereto as Exhibit 5.

86. All versions of Versata Automotive Configuration Manager, Versata 

Automotive Configuration Services, and Versata Material Cost Analytics are 

collectively referred to as “the Registered Works.”

87. Versata amends its software periodically by modifying the existing 

code from the previous software version, making limited changes as needed to fix 

software “bugs,” as well as to provide updated functionality. 

L. Ford is liable for copyright infringement

88. Versata is informed and believes, and based thereon alleges, that Ford 

violated its obligations with respect to the Registered Works by misusing and 

misappropriating the Registered Works within its companies and facilities for its 

personal gain.

89. Ford’s PDO software contains data files, source code, and technology 

that is accessible only through the use of Versata’s Registered Works, including 

ACM jar files contained in the PDO production stream. For example, during a 

review of Ford’s PDO source code, Versata discovered that that ACM components 

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cm.jar and trie.jar were literally copied into the PDO_PROD production stream in 

2012 and remained on the production stream until December of 2014.

90. Ford’s PDO, MCA 4.0, and SuperConfigurator software are also 

substantially similar to a wide variety of functionality in the Registered Works, or 

are works derivative thereof as that term is defined in the United States Copyright 

Act, indicating that Ford copied a substantial number of protectable elements of the 

Registered Works. Among the substantial similarities that Versata discovered during 

a review of Ford’s PDO software were rule handling in PDO, configuration creation 

and management in the SuperConfigurator, and similarity in naming conventions, 

structural details, and source code.

91. Versata also discovered comments from PDO developers discussing 

and analyzing functionality of Versata’s software, including ACM and MCA, in the 

PDO development stream during its review of Ford’s PDO source code indicating 

that Ford relied upon at least ACM and MCA to develop its infringing copycat 

software product.

92. Versata did not become aware that Ford had violated its obligations by 

making, using, distributing, and copying the Registered Works until approximately 

February 2016, when Versata conducted a court-ordered review of Ford’s PDO 

software at Ford’s headquarters in Michigan. At that time, it became clear to Versata 

that Ford had misappropriated the Registered Works and converted them to Ford’s 

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own use, in violation of Ford’s statutory and contractual obligations. Ford’s business 

is such that were Ford to misuse and misappropriate Versata’s proprietary 

technology as alleged, Ford would (and Versata alleges Ford did) benefit from its 

misdeeds even if it never applied for, obtained or licensed any software based on the 

technology. Versata is informed and believes that Ford continues to run major 

portions of its business operations based on its misuse and misappropriation of 

Versata’s proprietary technology.

93. Additionally, in its source code review, Versata also discovered a 

number of Versata files which originally contained Trilogy copyright management 

information, identifying Trilogy (now Versata) as the copyright owner of the files. 

The history of these files showed that these copyright notices had been removed over 

time. Only Ford had access to those files, and therefore it appears that Ford removed 

the copyright management information from the software files. 

94. During its source code review, Versata also discovered a number of 

PDO files with characteristics that demonstrate that Versata’s files were used as the 

starting point for the PDO files, rather than being independently developed, as Ford 

has claimed. The copied files no longer contain Versata copyright management 

information, and now contain Ford copyright management information, claiming 

that Ford owns a copyright on these files.

95. On information and belief, Ford intentionally removed Versata’s 

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copyright management information from the software files, and in some cases placed 

its own false copyright management information on the software files, knowing, or 

having reasonable grounds to know, that such actions would induce, enable, 

facilitate, or conceal Ford’s infringement of Versata’s copyrights.

FIRST COUNTERCLAIM

Infringement of the ‘651 Patent

96. Versata realleges and incorporates by reference herein the allegations 

contained in Paragraphs 1 through 95.

97. Ford has been and is now directly infringing the ‘651 patent in the State 

of Michigan, in this judicial district, and elsewhere within the United States by, 

among other things, making, using, licensing, selling, offering for sale, or importing 

software covered by one or more claims of the ‘651 patent, all to the injury of 

Versata.

98. As noted in the abstract of the ‘651 patent, Versata’s invention, among 

other things, “provides the ability to interactively select and configure a product 

among a set of related products based on the availability and compatibility of 

features and options” such that “only valid selections can be made at any time.” 

99. Ford’s acts of infringement have been willful, deliberate, and in 

reckless disregard of Versata’s patent rights, and will continue unless permanently 

enjoined by this Court.

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100. Versata has been damaged by Ford’s infringement of the ‘651 patent in 

an amount to be determined at trial, and has suffered and will continue to suffer 

irreparable loss and injury unless Ford is permanently enjoined from infringing the 

‘651 patent.

SECOND COUNTERCLAIM

Infringement of the ‘308 Patent

101. Versata realleges and incorporates by reference herein the allegations 

contained in Paragraphs 1 through 100.

102. Ford has been and is now directly infringing the ‘308 patent in the State 

of Michigan, in this judicial district, and elsewhere within the United States by, 

among other things, making, using, licensing, selling, offering for sale, or importing 

software covered by one or more claims of the ‘308 patent, all to the injury of 

Versata.

103. As noted in the abstract of the ‘308 patent, Versata’s invention 

“provides the ability to interactively select and configure a product among a set of 

related products based on the availability and compatibility of features and options” 

such that “only valid selections can be made at any time.” 

104. Ford’s acts of infringement have been willful, deliberate, and in 

reckless disregard of Versata’s patent rights, and will continue unless permanently 

enjoined by this Court.

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105. Versata has been damaged by Ford’s infringement of the ‘308 patent in 

an amount to be determined at trial, and has suffered and will continue to suffer 

irreparable loss and injury unless Ford is permanently enjoined from infringing the 

‘308 patent.

HIRD COUNTERCLAIM

Infringement of the ‘294 Patent

106. Versata realleges and incorporates by reference herein the allegations 

contained in Paragraphs 1 through 105.

107. Ford has been and is now directly infringing the ‘294 patent in the State 

of Michigan, in this judicial district, and elsewhere within the United States by, 

among other things, making, using, licensing, selling, offering for sale, or importing 

software covered by one or more claims of the ‘294 patent, all to the injury of 

Versata.

108. As noted in its abstract, the ‘294 patent covers, among other things, a 

system that “validates a configuration using the system definition, the current state 

of the configuration and user input.” 

109. Ford’s acts of infringement have been willful, deliberate, and in 

reckless disregard of Versata’s patent rights, and will continue unless permanently 

enjoined by this Court.

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110. Versata has been damaged by Ford’s infringement of the ‘294 patent in 

an amount to be determined at trial, and has suffered and will continue to suffer 

irreparable loss and injury unless Ford is permanently enjoined from infringing the 

‘294 patent.

FOURTH COUNTERCLAIM

Infringement of the ‘825 Patent

111. Versata realleges and incorporates by reference herein the allegations 

contained in Paragraphs 1 through 110.

112. Ford has been and is now directly infringing the ‘825 patent in the State 

of Michigan, in this judicial district, and elsewhere within the United States by, 

among other things, making, using, licensing, selling, offering for sale, or importing 

software covered by one or more claims of the ‘825 patent, all to the injury of 

Versata.

113. As noted in its abstract, the ‘825 patent covers, among other things, a 

“combined configuration-rules attribute configuration system [that] allows [a] query 

to be answered in a single step.” 

114. Ford’s acts of infringement have been willful, deliberate, and in 

reckless disregard of Versata’s patent rights, and will continue unless permanently 

enjoined by this Court. 

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115. Versata has been damaged by Ford’s infringement of the ‘825 patent in 

an amount to be determined at trial, and has suffered and will continue to suffer 

irreparable loss and injury unless Ford is permanently enjoined from infringing the 

‘825 patent. 

FIFTH COUNTERCLAIM

Infringement of the ‘582 Patent

116. Versata realleges and incorporates by reference herein the allegations 

contained in Paragraphs 1 through 115.

117. Ford has been and is now directly infringing the ‘582 patent in the State 

of Michigan, in this judicial district, and elsewhere within the United States by, 

among other things, making, using, licensing, selling, offering for sale, or importing 

software covered by one or more claims of the ‘582 patent, all to the injury of 

Versata.

118. As noted in its abstract, the ‘582 patent covers, among other things, a 

“consistency checking system that operates on subsets of the configuration space by 

consolidating data within the configuration space into minimized subsets that 

represent a portion of the configuration space where a particular consistency error 

can occur.”

119. Ford’s acts of infringement have been willful, deliberate, and in 

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reckless disregard of Versata’s patent rights, and will continue unless permanently 

enjoined by this Court.

120. Versata has been damaged by Ford’s infringement of the ‘582 patent in 

an amount to be determined at trial, and has suffered and will continue to suffer 

irreparable loss and injury unless Ford is permanently enjoined from infringing the 

‘582 patent.

SIXTH COUNTERCLAIM

Infringement of the ‘064 Patent

121. Versata realleges and incorporates by reference herein the allegations 

contained in Paragraphs 1 through 120. 

122. Ford has been and is now directly infringing the ‘064 patent in the State 

of Michigan, in this judicial district, and elsewhere within the United States by, 

among other things, making, using, licensing, selling, offering for sale, or importing 

software covered by one or more claims of the ‘294 patent, all to the injury of 

Versata.

123. As noted in its abstract, the ‘064 patent covers, among other things, a 

“consistency checking system that operates on subsets of the configuration space by 

consolidating data within the configuration space into minimized subsets that 

represent a portion of the configuration space where a particular consistency error 

can occur.”

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124. Ford’s acts of infringement have been willful, deliberate, and in 

reckless disregard of Versata’s patent rights, and will continue unless permanently 

enjoined by this Court.

125. Versata has been damaged by Ford’s infringement of the ‘064 patent in 

an amount to be determined at trial, and has suffered and will continue to suffer 

irreparable loss and injury unless Ford is permanently enjoined from infringing the 

‘064 patent.

SEVENTH COUNTERCLAIM

Infringement of the ‘080 Patent

126. Versata realleges and incorporates by reference herein the allegations 

contained in Paragraphs 1 through 125.

127. Ford has been and is now directly infringing the ‘080 patent in the State 

of Michigan, in this judicial district, and elsewhere within the United States by, 

among other things, making, using, licensing, selling, offering for sale, or importing 

software covered by one or more claims of the ‘294 patent, all to the injury of 

Versata.

128. As noted in its abstract, the ‘080 patent covers, among other things, a 

process that “combines multiple configuration models into a single unified 

configuration model that contains the union of the allowable combinations from each 

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of the original models.”

129. Ford’s acts of infringement have been willful, deliberate, and in 

reckless disregard of Versata’s patent rights, and will continue unless permanently 

enjoined by this Court.

130. Versata has been damaged by Ford’s infringement of the ‘080 patent in 

an amount to be determined at trial, and has suffered and will continue to suffer 

irreparable loss and injury unless Ford is permanently enjoined from infringing the 

‘080 patent.

EIGHTH COUNTERCLAIM

Infringement of the ‘057 Patent

131. Versata realleges and incorporates by reference herein the allegations 

contained in Paragraphs 1 through 130. 

132. Ford has been and is now directly infringing the ‘057 patent in the State 

of Michigan, in this judicial district, and elsewhere within the United States by, 

among other things, making, using, licensing, selling, offering for sale, or importing 

software covered by one or more claims of the ‘294 patent, all to the injury of 

Versata.

133. As noted in its abstract, the ‘057 patent covers, among other things, a 

procedure that “break[s] a configuration problem down into a set of smaller 

problems, solving them individually and recombining the results into a single result 

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that is equivalent to a conventional inference procedure.” 

134. Ford’s acts of infringement have been willful, deliberate, and in 

reckless disregard of Versata’s patent rights, and will continue unless permanently 

enjoined by this Court.

135. Versata has been damaged by Ford’s infringement of the ‘057 patent in 

an amount to be determined at trial, and has suffered and will continue to suffer 

irreparable loss and injury unless Ford is permanently enjoined from infringing the 

‘057 patent.

NINTH COUNTERCLAIM

Trade Secret Misappropriation

136. Versata realleges and incorporates by reference the allegations 

contained in Paragraphs 1 through 135.

137. As set forth above, Versata developed and owns the Confidential 

Information. Such Confidential Information has been treated as confidential and 

restricted information, and Versata has taken reasonable steps to protect it from 

unauthorized use or disclosure.

138. Ford has breached its obligations to not use or disclose the trade secrets 

and associated Confidential Information, by doing the acts set forth above. 

Specifically, Ford has misused, misappropriated, disclosed and made public the 

Confidential Information including trade secrets disclosed to them in confidence, by 

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sharing this information with the PTO and other third parties within and outside its 

companies. Additionally, Ford has misused and misappropriated the Confidential 

Information within its companies to develop technology based on the Confidential 

Information, for its own personal gain.

139. Ford’s breaches have caused damage to Versata in an amount to be 

determined at trial.

TENTH COUNTERCLAIM

Conversion (Common Law and Statutory)

140. Versata realleges and incorporates by reference the allegations 

contained in Paragraphs 1 through 139.

141. Versata provided its Confidential Information to Ford. Ford was at all 

times and continues to be under an obligation not to disclose, or claim as their own, 

the Confidential Information disclosed by Versata. This material was contained in 

physical media such as compact discs and non-public user manuals as well as 

electronic files. These physical media and electronic files contain valuable data and 

propriety information belonging to Versata.

142. However, despite its obligations, Ford has wrongfully exercised 

dominion and control over such Confidential Information as well as the physical 

media, documents, and electronic data belonging to Versata and converted to its own 

use the technology disclosed in the Confidential Information, and to obtain from the 

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PTO United States Patent No. 8,812,375.

143. After becoming aware of this misappropriation and conversion, Versata 

has demanded to inspect Ford’s TCM software to determine the extent to which this 

software incorporates Versata technologies, including physical items such as discs, 

manuals, and code.

144. Ford has refused to permit this inspection to take place, even though it 

is required by the MSSA. Therefore, combined with Ford’s clear misappropriation 

of Versata’s trade secrets, this creates a strong basis to believe that Ford has 

misappropriated the physical materials that contain those trade secrets.

145. Ford’s conversion has caused damages to Versata in an amount to be 

determined at trial.

146. Ford’s actions described above were taken with malice, fraud, 

oppression and forethought, were intentionally done to steal from Versata the 

physical media, electronic files, and Confidential Information in question and to 

illegally profit thereby, and later were taken to obtain a patent from the PTO without 

disclosing to the PTO that the patent applications were based on and derived from 

the Confidential Information of Versata. Thus, Ford’s actions justify an award of 

punitive or exemplary damages in a favor of Versata and against Ford in an amount 

to punish Ford and deter such future conduct by Ford and others.

147. Versata is entitled to treble damages and its attorney fees for statutory 

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conversation, pursuant to MCL 600.2919a.

ELEVENTH COUNTERCLAIM

Breach of Contract

148. Versata realleges and incorporates by reference the allegations 

contained in Paragraphs 1 through 147.

149. On October 19, 1998, Ford and Versata entered into a valid software 

licensing contract for the provision of Versata’s patented configuration software.

150. On December 22, 2004, Ford and Versata entered into a second valid 

software licensing contract for the provision of Versata’s software, including

patented ACM software and MCA software.

151. Among the duties Ford agreed to in its contracts with Versata is a duty 

not to reverse engineer or copy Versata’s software, a duty to maintain the 

confidentiality of Versata’s software, a duty to return or destroy all Confidential 

Information as defined by the contracts upon termination of the agreements, and a 

duty to restrict access to Versata’s Confidential Information to only employees and 

third-party contractors who had signed agreements to protect Versata’s Confidential 

Information.

152. Ford materially breached these contracts by misusing, 

misappropriating, failing to return, and disclosing at least some of the Confidential 

Information to various third parties, including but not limited to the USPTO, in direct 

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violation of the CSA and the MSSA.

153. Ford further breached the MSSA by refusing to permit Versata to 

exercise its audit rights under the contract, and by continuing to use Versata’s 

software without a license and without payment of licensing fees.

154. Ford further breached the MSSA by allowing multiple employees and 

third-party contractors who did not have written agreements to protect Versata’s 

Confidential Information to access Versata’s Confidential Information.

155. Ford further breached the CSA and MSSA by reverse engineering 

Versata’s software for its own commercial use.

156. Ford’s actions have caused Versata damages in an amount to be 

determined at trial.

TWELTH COUNTERCLAIM

Breach of 2002 Settlement Agreement

157. Versata realleges and incorporates by reference the allegations 

contained in Paragraphs 1 through 156.

158. As set forth above, on or about January 1, 2002, Ford and Versata 

settled a previous dispute by executing the Software Subscription Agreement 

(“SSA”). Article 2F of the SSA requires Ford to “provide reasonable assistance in 

perfecting and protecting GPD Software intellectual property for Trilogy.” Exhibit 

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A to the SSA specifically defines this “GPD Software” as version 3.2 of ACM. Ford 

reaffirmed its commitment to protect Versata’s intellectual property in at least five 

agreements following the SSA. These included amendments to the SSA dated, July 

1, 2002; February 28, 2003; July 1, 2004; November 1, 2003; December 23, 2003.

159. The SSA was and is a valid contract, and Versata has performed its 

obligations thereunder. Ford materially breached these provisions by filing Inter 

Partes Review petitions seeking to have the Patent Office declare six of the eight 

Versata patents-in-suit invalid. These IPR petitions are a direct, offensive attack on 

the validity of Versata’s ACM-related patents and are therefore a violation of Ford’s 

duty to provide reasonable assistance to protect this intellectual property. Ford’s 

breaches caused damage to Versata. 

THIRTEENTH COUNTERCLAIM

Trade Secret Misappropriation Under Defend Trade Secrets Act of 2016

18 U.S.C. 1832 et seq.

160. Versata realleges and incorporates by reference the allegations 

contained in Paragraphs 1 through 159.

161. As set forth above, Versata developed and owns the Confidential 

Information. Such Confidential Information has been treated as confidential and 

restricted information, and Versata has taken reasonable steps to protect it from 

unauthorized use or disclosure. Such Confidential Information also constitutes trade 

secrets that belong to Versata. Versata owns these trade secrets.

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162. Versata’s trade secrets and associated Confidential Information are 

related to Versata’s products, including at least ACM, that is used in interstate or 

foreign commerce.

163. Ford has actual possession of Versata’s trade secrets and associated 

Confidential Information.

164. Ford has breached its obligations to not use or disclose the trade secrets 

and associated Confidential Information, by doing the acts set forth above. 

Specifically, Ford has misused, misappropriated, disclosed and made public the 

Confidential Information including trade secrets disclosed to them in confidence, by 

sharing this information with the PTO and other third parties within and outside its 

companies. Additionally, Ford has misused and misappropriated the Confidential 

Information within its companies to develop technology based on the Confidential 

Information, for its own personal gain.

165. Ford’s breaches constitute acts of misappropriation that have been 

willful and malicious, and will continue unless permanently enjoined by this Court.

166. Versata has been damaged by Ford’s misappropriation of Versata’s 

trade secrets in an amount to be determined at trial, and has suffered and will 

continue to suffer irreparable loss and injury unless Ford is permanently enjoined 

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from misappropriating Versata’s trade secrets.

FOURTEENTH COUNTERCLAIM

Copyright Infringement

167. Versata realleges and incorporates by reference the allegations 

contained in Paragraphs 1 through 166 and all following paragraphs.

168. As set forth above, Versata is the exclusive legal owner of a valid and 

enforceable copyright in all versions of the software programs Versata Automotive 

Configuration Manager, Versata Automotive Configuration Services, and Versata 

Material Cost Analytics.

169. The Registered Works are creative works of original authorship by 

Versata and contain a copyright notice indicating the content is owned by Versata.

170. As of at least January 15, 2015, Ford was not authorized or licensed to 

copy, reproduce, modify, distribute or display any of the Registered Works.

171. Since January 15, 2015, Ford has continued to use the Registered 

Works.

172. Ford, through its unlicensed use of the Registered Works, knowingly 

and willfully infringed and continues to infringe Versata’s exclusive copyrights in 

the Registered Works and in the exclusive copyrights of those works themselves.

173. Ford’s unlicensed use, copying, reproduction, modification, 

distribution, and/or display of the Registered Works directly infringes on Versata’s 

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exclusive copyright in the software programs by copying or reproducing the 

copyrighted work in violation of 17 U.S.C. § 501 et seq.

174. As a result of the foregoing, Versata is entitled to damages pursuant to 

17 U.S.C. § 504(a), in the amount of its actual damages and the additional profits of 

Ford in an amount to be established at trial.

175. Alternatively, as a result of the foregoing, Versata is entitled to statutory 

damages pursuant to 17 U.S.C. § 504(a), including additional statutory damages for 

Ford’s willful infringement.

176. Unless the Court enjoins and restrains Ford’s infringing use of the 

Registered Works, Versata will suffer irreparable and immediate injury and loss and 

damage for which Versata has no adequate remedy at law.

177. Versata is entitled to temporary, preliminary, and permanent injunctive 

relief enjoining Ford from continuing its infringing use of the Registered Works.

178. Wherefore, pursuant to 17 U.S.C. § 502, Versata is entitled to an 

injunction to prevent and restrain infringement by ordering Ford not to use, copy, 

disseminate, or otherwise infringe Versata’s copyrights in its software.

179. Pursuant to 17 U.S.C. § 503, Versata is entitled to remedy of seizure 

and impounding of all materials used in violation of Versata’s exclusive copyright 

rights in the Registered Works.

180. Pursuant to 17 U.S.C. § 503, following final deposition of the case, 

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Versata is also entitled to a Court Order requiring destruction or other reasonable 

disposition of all copies found to have been in violation of Versata’s exclusive rights 

and of all other articles by means of which such copies are, have been, or may be 

produced.

181. Pursuant to 17 U.S.C. § 504, Versata is entitled to an accounting of all 

gains, profits, and advantages derived by Ford’s infringement of Versata’s 

copyrights so that Versata may properly determine the full extent of its damages 

under the Copyright Act.

182. Pursuant to 17 U.S.C. § 505, and due to Ford’s infringement of 

Versata’s exclusive copyright rights, Versata is entitled to an award of its attorneys’ 

fees and expenses of litigation.

FIFTEENTH COUNTERCLAIM

Violation of the DMCA’S Anti-Circumvention Provision (17 U.S.C. 1201)

183. Versata realleges and incorporates by reference the allegations 

contained in Paragraphs 1 through 182.

184. As set forth above, Versata is the exclusive legal owner of a valid and 

enforceable copyright in all versions of the software programs Versata Automotive 

Configuration Manager, Versata Automotive Configuration Services, and Versata 

Material Cost Analytics.

185. The Registered Works are creative works of original authorship by 

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Versata and contain a copyright notice indicating the content is owned by Versata.

186. As of January 15, 2015, Ford was not authorized or licensed to copy, 

reproduce, modify, distribute or display any of the Registered Works.

187. Ford has never been authorized to decompile or reverse engineer 

Versata’s object files.

188. Versata employs several technological measures to protect the 

Registered Works, include controlling access to its source code with a source code 

control system which requires an authorized username and password and by 

providing only compiled object file versions of the Registered Works.

189. Ford has decompiled Versata’s object files to obtain an unauthorized 

copy of the source code version of the Registered Works.

190. Each of these measures effectively controls access to Versata’s work 

because, in the ordinary course of operation, the measures require the application of 

information or of a process, with Versata’s authority, to gain access to the work.

191. This decompiling, which was done without Versata’s authorization, 

improperly circumvented the technological measures Versata had implemented to 

control access to its work.

192. Versata seeks all the relief it is entitled to under the Copyright Act, 

including but not limited to the provisions of 17 U.S.C. 1203. As authorized by 

Section 1203, Versata requests the Court to impound all devices or products that are 

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in Ford’s custody and control which the Court has reasonable cause to believe was 

involved in Ford’s violation of Versata’s rights under 17 U.S.C. 1201. Versata also 

seeks the recovery of damages, costs, reasonable attorneys’ fees, and the 

modification or destruction of any device or product involved in Ford’s infringement 

of Versata’s rights. 

SIXTEENTH COUNTERCLAIM

Violation of Digital Millennium Copyright Act

17 U.S.C. 1202

193. Versata incorporates by reference the allegations contained in 

Paragraphs 1 through 192.

194. Versata’s ACM software is protected by copyright. As set forth above, 

Versata placed copyright management information in its ACM software, including 

without limitation a notice of copyright. 

195. As set forth above, Ford intentionally removed and/or altered copyright 

management information in Versata’s software. 

196. Ford removed and/or altered this copyright management information 

without legal authorization, including without authorization from Versata, and did 

so knowing, or having reasonable grounds to know, that it would induce, enable, 

facilitate, or conceal an infringement of Versata’s rights under Title 17 of the United 

States Code. By removing Versata’s copyright management information from some 

software, and by replacing Versata’s copyright management information with Ford’s 

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false copyright management information in other software, Ford sought to conceal 

the fact that it had copied Versata’s software.

197. Versata seeks all the relief it is entitled to under the Copyright Act, 

including but not limited to the provisions of 17 U.S.C. 1203. As authorized by 

Section 1203, Versata requests the Court to impound all devices or products that are 

in Ford’s custody and control which the Court has reasonable cause to believe was 

involved in Ford’s violation of Versata’s rights under 17 U.S.C. 1202. Versata also 

seeks the recovery of damages, costs, reasonable attorneys’ fees, and the 

modification or destruction of any device or product involved in Ford’s infringement 

of Versata’s rights. 

APPLICATION FOR PRELIMINARY AND PERMANENT INJUNCTION

198. Versata incorporates by reference herein Paragraphs 1 through 197.

199. The actionable conduct of Ford has recently threatened and is starting 

to cause imminent and irreparable harm to Versata. 

200. Specifically, Ford’s refusal to honor its contractual obligations to return 

Versata’s software documentation and to remove Versata’s proprietary software 

from its global computer networks and servers has resulted in widespread 

dissemination of Versata’s trade secrets to Ford employees and potentially other 

third-parties in violation of the license agreement. Versata have no remedy at law 

for the widespread dissemination of their trade secrets to the general public in form 

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of Ford’s stolen “super configurator” technology.

201. Although Ford claims that it is no longer using Versata’s software, 

including ACM, MCA, and ACS, it has refused to permit an audit of its systems to 

ensure the software has been deleted or to return Versata’s documentation and user 

manuals.

202. To preserve the status quo until trial in this cause, Versata hereby 

request the Court to preliminarily enjoin and restrain Ford, and its agents, servants, 

employees and all persons acting under, and in concert with, or for them, through 

both a temporary restraining order and a preliminary injunction, from: (i) providing 

Versata’s trade secrets to Ford employees or third-parties engaged in the 

development of ACM and automotive configuration software; (ii) copying, reverse 

engineering, or disseminating Versata’s trade secrets and confidential information; 

(iii) taking action or encouraging others to take action restrained above or otherwise 

to harm Versata or Versata’s businesses; and (iv) from pursuing IPRs or other postgrant review before the Patent Office. Versata also requests that the Court order 

Ford to immediately comply with the audit provision of the MSSA or otherwise 

fashion relief to ensure that Ford is not continuing to use, copy, reverse-engineer, 

and disseminate Versata’s trade secrets and copyrighted proprietary software.

203. Following trial on the merits, Versata hereby request that the Court 

enter a permanent injunction enjoining the foregoing acts as well as (i) all further 

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infringement of all patents found to be infringed; (ii) all further misappropriation, 

use, possession, or infringement of Versata’s trade secrets; (iii) all further use or 

possession of Versata’s software and related documentation; and (iv) all further 

challenges to the validity of Versata’s patents and intellectual property. 

204. To preserve the status quo until trial in this cause, Versata hereby 

requests the Court to preliminarily enjoin and restrain Defendants, and their agents, 

servants, employees and all persons acting under, and in concert with, or for them, 

through both a temporary restraining order and a preliminary injunction, from: (i) 

providing Versata’s copyrighted Registered Works to Ford employees or third 

parties engaged in the development of ACM and automotive configuration software; 

(ii) copying, reverse engineering, or disseminating Versata’s Registered Works and 

confidential information; and (iii) taking action or encouraging others to take action 

restrained above or otherwise to harm Versata or Versata’s businesses. Versata also 

request that the Court order Ford to immediately comply with the audit provision of 

the MSA or otherwise fashion relief to ensure that Ford is not continuing to use, 

copy, reverse-engineer, and disseminate Versata’s trade secrets and copyrighted 

proprietary software.

205. Following trial on the merits, Versata hereby request that the Court 

enter a permanent injunction enjoining the foregoing acts as well as (i) all further 

infringement of all copyrights found to be infringed; (ii) all further misappropriation, 

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use, possession, or distribution of Versata’s Registered Works; and (iii) all further 

use or possession of Versata’s software and related documentation.

PRAYER FOR RELIEF

WHEREFORE, the Versata Defendants and Counterclaimants pray for 

judgment as follows:

A. That the Court dismiss Ford’s Complaint;

B. That the Court enter judgment in favor of Versata that Ford has 

infringed Versata’s ‘651, ‘308, ‘294, ‘582, ‘064, ‘825, ‘080, and ‘057 patents;

C. That Court enter a permanent injunction, enjoining Ford and its 

officers, directors, agents, servants, employees, affiliates, divisions, subsidiaries, 

and parents from infringing, inducing the infringement of, or contributing to the 

infringement of Versata’s ‘651, ‘308, ‘294, ‘582, ‘064, ‘825, ‘080, and ‘057 patents;

D. That the Court enter a judgment and order requiring Ford to pay Versata 

damages for Ford’s infringement of the ‘651, ‘308, ‘294, ‘582, ‘064, ‘825, ‘080, and 

‘057 patents, together with interest (both pre and post-judgment), costs, and 

disbursement as fixed by this Court under 35 U.S.C. § 284;

E. That the Court enter a judgment and order finding Ford’s infringement 

willful and awarding treble the amount of damages and losses sustained by Versata 

as a result of Ford’s infringement under 35 U.S.C. § 284;

F. That the Court enter a judgment and order finding that this is an 

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exceptional case within the meaning of 35 U.S.C. § 285 and awarding Versata its 

reasonable attorney’s fees;

G. That the Court enter an award pursuant to 17 U.S.C. § 504 in favor of 

Versata and against Ford for such actual damages as Versata has sustained in 

consequence of Ford’s infringement of Versata’s copyrights, and Ford’s additional 

profits; or alternatively, an award of statutory damages, including an award for 

willful infringement;

H. That the Court enter an award pursuant to 17 U.S.C. § 504 compelling 

Ford to account for all gains, profits, and advantages derived by its infringement of 

Versata's copyrights or such damages as are proper within the provisions of the 

Copyright Act;

I. That the Court enter injunctive relief pursuant to 17 U.S.C. § 503 

preventing and restraining Ford from infringing Versata’s copyrights by ordering 

Ford not to publish, distribute, use, create, or use derivative works of the copyrighted 

materials of Versata;

J. That the Court enter an order pursuant to 17 U.S.C. § 503 impounding

all materials used in violation of Versata's exclusive copyrights;

K. That the Court enter an award pursuant to 17 U.S.C. § 505 in favor of 

Versata and against Ford for such damages, costs, and expenses, and attorneys’ fees 

Versata has incurred in regard to this proceeding;

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L. That the Court enter a preliminary and permanent injunction requiring 

Ford to stop using and return all Versata’s software, product documentation, and 

derivative works that are in Ford’s possession;

M. That the Court enter a preliminary and permanent injunction 

prohibiting Ford employees or contractors with access to Versata’s configuration 

software from developing or implementing other configuration software for Ford;

N. That the Court enter a permanent injunction, enjoining Ford and its 

officers, directors, agents, servants, employees, affiliates, divisions, subsidiaries, 

and parents from infringing, inducing the infringement of, or contributing to the 

infringement of Versata’s copyrights in the Registered Works;

O. That the Court enter a judgment and order requiring Ford to pay Versata 

damages for Ford’s infringement of Versata’s copyrights in the Registered Works;

P. That the Court enter an award in favor of Versata and against Ford for 

such damages as Versata has sustained in consequence of Ford’s breach of contract;

Q. That the Court enter an award in favor of Versata and against Ford for 

such damages as Versata has sustained in consequence of Ford’s misappropriation 

of Versata’s trade secrets;

R. That the Court enter an award in favor of Versata and against Ford for 

exemplary damages for Ford’s willful and malicious appropriation of Versata’s trade 

secret information;

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S. That the Court enter injunctive relief preventing Ford’s further use or 

disclosure of Versata’s trade secret information;

T. That the Court enter a preliminary and permanent injunction requiring 

Ford to stop using and return all Versata’s software, product documentation, and 

derivative works that are in Ford’s possession;

U. That the Court enter a preliminary and permanent injunction 

prohibiting Ford employees or contractors with access to Versata’s configuration 

software from developing or implementing other configuration software for Ford; 

V. That the Court enter a permanent injunction prohibiting all further 

infringement of all patents found to be infringed, all further misappropriation, use, 

possession, or infringement of Versata’s trade secrets, and all further use or 

possession of Versata’s software and related documentation;

W. That the Court enter an award in favor of Versata and against Ford for 

such damages as Versata has sustained in consequence of Ford’s conversion of 

Versata’s Confidential Information;

X. That Court enter a permanent injunction under 18 U.S.C. 

§ 1836(b)(3)(A), enjoining Ford and its officers, directors, agents, servants, 

employees, affiliates, divisions, subsidiaries, and parents from misappropriating 

Versata’s trade secrets;

Y. That the Court enter a judgment and order finding Ford’s 

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misappropriation of Versata’s trade secrets willful and malicious and awarding 

double the amount of damages and losses sustained by Versata as a result of Ford’s 

misappropriation under 18 U.S.C. § 1836(b)(3);

Z. That the Court enter a preliminary injunction prohibiting Ford from 

pursuing IPRs before the Patent Office until such time that this Court resolves the 

relevant contract issues;

AA. That the Court enter a judgment and order finding that Ford has violated 

Sections 1201 and 1202 of the Digitial Millennium Copyright Act and awarding 

damages, costs, and reasonable attorneys’ fees to Versata pursuant to the Act, 17 

U.S.C. 1201 et seq;

BB. That the Court enter a judgment and order for the impounding and/or 

destruction of all devices or products that are in Ford’s custody and control which 

the Court has reasonable cause to believe was involved in Ford’s violation of 

Versata’s rights under 17 U.S.C. 1201 and/or 1202;

CC. That the Court provide for trial by jury on all issues triable by jury; and

DD. That the Court grant such other and further relief in law or in equity to 

which Versata may be justly entitled.

RELIANCE ON JURY DEMAND 

Defendants Versata Software, Inc., f/k/a Trilogy Software, Inc., Trilogy 

Development Group, Inc., and Trilogy, Inc. relies on the Jury Demand previously 

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filed in the above-captioned matter. 

Dated: February 10, 2017 AHMAD, ZAVITSANOS, ANAIPAKOS, ALAVI 

& MENSING P.C.

 /s/ Steven J. Mitby

Steven J. Mitby

Texas State Bar No. 24037123

smitby@azalaw.com

Iftikhar Ahmed

Texas State Bar No. 24064795

iftiahmed@azalaw.com

Foster C. Johnson

Texas State Bar No. 24076463

fjohnson@azalaw.com

Reed N. Smith

Texas State Bar No. 24067875

rsmith@azalaw.com

AHMAD, ZAVITSANOS, ANAIPAKOS, ALAVI &

MENSING, P.C.

1221 McKinney, Suite 2500

Houston, Texas 77010

(713) 655-1101 (Phone)

(713) 655-0062 (Fax)

YOUNG & ASSOCIATES

/s/ Rodger D. Young

Rodger D. Young (P22652)

27725 Stansbury Blvd., Suite 125

Farmington Hills, MI 48334

248.353.8620

efiling@youngpc.com 

COUNSEL FOR DEFENDANTS 

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

FORD MOTOR COMPANY, CASE NO. 15-10628-MFL-EAS

Plaintiff/Counter-Defendant, (Consolidated with

Case No. 15-11264-MFL-EAS)

v. Hon. Matthew F. Leitman

VERSATA SOFTWARE, INC., F/K/A

TRILOGY SOFTWARE, INC., TRILOGY

DEVELOPMENT GROUP, INC. AND

TRILOGY, INC.,

Defendants/Counter-Plaintiffs.

___________________________________________________________________________

PROOF OF SERVICE 

Rodger D. Young certifies that on February 10, 2017, he served this 

Defendants’ Answer to Plaintiff’s Second Amended Complaint for Declaratory 

Judgment, Affirmative and Special Defenses; Defendants’ Counterclaims, and 

Reliance on Jury Demand upon all counsel of record via electronic filing.

I declare under the penalty of perjury that the statements made above are true 

to the best of my knowledge, information, and belief.

YOUNG & ASSOCIATES

/s/ Rodger D. Young

Rodger D. Young (P22652)

27725 Stansbury Blvd., Suite 125

Farmington Hills, MI 48334

248.353.8620

efiling@youngpc.com 

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