Equinix Sued By Data Center Tenant, Accused Of Stealing Intellectual Property

Data center giant Equinix is facing a patent infringement lawsuit from one of its tenants. 

Boca Raton-based Cloud Conductor LLC filed a lawsuit Thursday in a Florida federal court accusing Equinix of stealing technology that the Florida firm had placed in one of the colocation giant’s data centers.

The filing alleges that Equinix began offering a cloud connectivity service identical to a product patented by Cloud Conductor and only began offering that service after hosting the infrastructure for Cloud Conductor’s competing product in one of its facilities. 

“As a result of Defendant’s unfettered access to Cloud Conductor’s network, structure, and routing and switching system, Defendant was able to copy Cloud Conductor’s patented material and offer it for sale to its expansive breadth of clients around the world, foreclosing the opportunity for Cloud Conductor to take market advantage of its unique intellectual property,” said the complaint, signed by Cloud Conductor's attorneys, Joe Grant and Jennifer Gordon of Lorium PLLC. 

According to Cloud Conductor’s website, it offers a platform with an array of services that help companies integrate cloud services from providers like Amazon Web Services, Microsoft and Equinix into their IT infrastructure. The company’s complaint against Equinix provides little detail regarding the specific technology and services that Cloud Conductor alleges were copied, describing them only as “cloud network services having a gateway for subscriber-specified connection to a cloud service provider.”

A representative for Equinix told Bisnow the company doesn't comment on pending litigation.  

This isn't the first time that data center operators or cloud providers have faced patent infringement litigation from clients, and the result of at least one of those cases has had consequences for data center development.

Seven Networks LLC sued Google over intellectual property theft in 2019, a case that was heard in the Eastern District of Texas, thought to be particularly friendly toward plaintiffs in patent infringement suits. Although neither company was based in Texas, the presence of Google servers in a third-party colocation data center in the Eastern District allowed the case to go forward there. As a result, experts say some developers have been shying away from what had been a robust market for data center builders. 

“It's in everybody's decision matrix,” CBRE Senior Vice President Brant Bernet told Bisnow last week. “If you can find a site that is outside of the Eastern District and it checks all the other boxes, it probably gets a better look.”