Barnes & Noble unveiled eReader--the Nook, on Oct. 20. The device is expected to debut at the end of November for $259. It has touch-sensitive display, color, allows for wireless downloads via AT&T’s 3G network or Wi-Fi, and runs on a variation of Android platform.
Eric Kmeic, Spring Design VP of Sales and Marketing said, “Spring Design unfortunately had to take the appropriate action to protect its intellectual property rights. We showed the Alex e-book design to Barnes & Noble in good faith with the intention of working together to provide a superior dual screen e-book to the market."
Spring Design alleges copied design
Spring Design said that B&N’s eReader the Nook has features that are too close to its eReader Alex’s. The devices in question will run on Google Inc’s. (GOOG.O) Android operating system and both features two screens. The Nook, like Alex, combines a color touch-screen with an e-ink display.
The lawsuit, filed in U.S. District Court for the Northern District of California on Monday afternoon, states that the Spring Design first presented their design for the eReader Alex on Feb. 17, 2009, to a Barnes and Noble’s consultant, five days after both parties signed non-disclosure document.
On March 20, Spring Design executives met with the Head of B&N software development, Ravi Gopalakrishnan, who allegedly told them that B&N wants to develop a product that will efficiently compete with the Amazon’s (NSQD: AMZN) Kindle.
In April and May, they also met with other B&N executives, including William Lynch, president of B&N.com and Kevin Frain, B&N’S CFO. Frain and lynch were given a PowerPoint presentation and demo for an Android-based e-Reader known as Alex.
"Lynch warned Spring's Albert Teng that he should not consider Amazon as a content partner, because Amazon was likely to steal Spring's unique idea without ever buying anything from Spring," according to court documents.
In July, B&N requested a summary of Spring’s product development and on Oct. 1, Spring’s CEO had a meeting with B&N people to discuss possible revenue sharing for Alex device in the university textbook market.
B&N "made no mention during that meeting or any other meeting with Spring that it was actually in the process of developing a device with many of the product features contained in the Spring design," Spring said in its filing.
On Oct. 20, Barnes and Noble announced their eReader the Nook, which came as a “complete surprise to Spring”.
SD accuses B&N of breach of agreement
The features described by Lynch in media on Oct. 21 about the Nook were all "disclosed to B&N by Spring under the terms of the NDA in anticipation of a potential business partnership between the parties," Spring wrote.
"B&N unlawfully misappropriated and used Spring's confidential information and trade secrets to develop and sell a competing product, the Nook, for its own benefit," the filing said.
Spring is accusing Barnes and Noble’s of breaching the non-disclosure agreement, violating unfair competition laws, and misappropriating trade secrets.
No one from Barnes and Noble was not available for making any statement regarding the lawsuit, neither was there any word on what or how much in damages Spring is hoping to get out of the lawsuit.
The Spring Design is not just suing for monetary damages, but is also seeking halt to the Nook sales.
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