DeHeng Lawyers Successfully Represented a Client in an Arbitration Case over a Software License Agreement Dispute, Avoiding Huge Economic Losses

2023-08-11

After more than three years, a software license agreement dispute arbitration case was concluded with the claimant, a well-known multinational software company, withdrawing all its claims against the respondent, a large enterprise represented by DeHeng. 

In early 2020, a multinational software company (as the claimant in the arbitration) filed a request for arbitration with the China International Economic and Trade Arbitration Commission (CIETAC) on the grounds that a large enterprise (as the respondent) had used its software services beyond the scope of the license, demanding that the respondent and all its affiliates be verified on the performance of intellectual property rights, and that the respondent pay the license fee based on the verification results, and bear all the actual expenses and arbitration costs of the case.

In this case, the claimant enjoys absolute monopoly over some software it operates in the Chinese market, and its parent company is a top-rated multinational corporation. The claimant is extremely influential and has an edge in the economic and social spheres, and its legal team is very professional and capable. If the claims were granted by the arbitral tribunal, the claimant would surely use this as a basis to demand verification of other domestic enterprises, which would pose a great threat to the security of the trade secrets and technical secrets of the verified enterprises, leading to consequences of self-evident severity. 

Mandated by the respondent, the DeHeng team, led by lawyers Xie Lijin and Guo Qingsong, conducted a detailed and rigorous analysis of the facts of the case and the applicable laws. With the assistance of the client’s legal team and according to the actual situation of the case, they constructed four solid lines of defense. The respondent fully respected the professional advice of DeHeng’s lawyers and decided not to accept the settlement proposal put forth by the claimant and appealed to the arbitral tribunal for a fair award.

In the end, with no hope of settlement and the possibility of its arbitration claims rejected by the arbitral tribunal, the claimant had no choice but to withdraw all of its arbitration claims. Hence DeHeng lawyers helped the client avoid the possible leakage of core trade secrets and huge economic losses that might be caused by performance verification.