Razorsight Steals From TEOCO; Pays US$4.5m

Razorsight, the revenue and cost optimization vendor headquartered in Fairfax, Virginia, USA, has been ordered by a court to pay US$4.5m in settlement for stealing intellectual property. The property was stolen from TEOCO, another revenue assurance and cost management vendor based in Fairfax. The story is that former TEOCO employees, including Razorshite founder and Chairman Sundeep Sanghavi, had long been using TEOCO’s intellectual property as part of their rival offerings. The court has also judged that Razorshite must immediately stop using TEOCO’s intellectual property, must remove, destroy or return the intellectual property in its possession and its deployed systems by September 1, and should be subject to an audit thereafter. The court’s decision was made somewhat easier by the admission of liability by the defendants. TEOCO discovered the theft in mid-2007, though the subsequent lawsuit’s discovery process revealed the extent of the theft was greater than they had first thought. You can read TEOCO’s press release here. Look here for the official court order of the US District Court for Eastern Virginia.

Not surprisingly, there is no mention of the contravention or the court order on Razorshite’s website. However, there is a press release dated May 19 that tries to give the impression that Razorshite is moving in the right direction. It states that Razorshite’s VC backers have pumped another US$9m into the company, in order to “expand Razorsight’s innovative product set, accelerate the company’s international expansion… and to support strategic global alliances.” What a load of bull. Half of it will go straight to TEOCO. Presumably the other half will go on development to replace TEOCO’s stolen intellectual property, the costs of ripping out the stolen property and on kissing customer butts. Some of those customers must now be wondering whether they picked the right vendor in the first place, given they were unwittingly using TEOCO’s intellectual property. You can read Razorshite’s humbug press release about new funding here.

Intellectual Property theft is more common in revenue assurance than most people care to admit. That is a damning statement, and so it should be. There is hypocrisy in selling the goal of integrity and compliance with legal and accounting expectations, whilst knowing the offerings were stolen from somebody else. At times revenue assurance is like the Wild West of telecoms. It has the right cast of characters: prospectors, sheriffs, pioneers, gold diggers, madams, company men, bandits, and engineers. We can now add outlaws to the list. I have written before about the tendency for people in revenue assurance to help themselves to other people’s work. Part of the problem is that too many turn a blind eye when it happens, or worse still they are happy to indirectly benefit from the crime. Eventually the Wild West was tamed, and civilized. The honest folk won because they stood up to the troublemakers and lawbreakers. Next time you see, or suspect, the infringement of intellectual property rights, remember it is your duty to speak up. I am sure you feel the way I do: rewards and recognition should go to the people who deserve them, not to the people who will stop at nothing to get them. Honest people can win, if we stand together. We must stand up for honesty, or we all risk being branded as cowboys.

Eric Priezkalns
Eric Priezkalns
Eric is the Editor of Commsrisk. Look here for more about the history of Commsrisk and the role played by Eric.

Eric is also the Chief Executive of the Risk & Assurance Group (RAG), a global association of professionals working in risk management and business assurance for communications providers.

Previously Eric was Director of Risk Management for Qatar Telecom and he has worked with Cable & Wireless, T‑Mobile, Sky, Worldcom and other telcos. He was lead author of Revenue Assurance: Expert Opinions for Communications Providers, published by CRC Press. He is a qualified chartered accountant, with degrees in information systems, and in mathematics and philosophy.

3 Comments on "Razorsight Steals From TEOCO; Pays US$4.5m"

  1. Avatar michael hicks | 10 Jun 2008 at 10:06 pm |

    Good blog! Btw, of the $9M they got from Sierra…$4.5 goes to us, then the next few million go to their lawyers which then doesn’t leave much for the reengineering and butt kissing! Ah, the challenges of business!

  2. Avatar Curious George | 7 Oct 2008 at 11:39 am |

    Do you have any thoughts as to how the theft and resulting fines have affected Razorsight’s credibility in the marketplace? I would assume they are struggling and notice that the press releases touting new customers have been non existent this year.

  3. I am not close enough to the American market to have an opinion. It would be nice to say this incident had destroyed Razorsight’s credibility, but after some of the procurement shenanigans I have seen over the years, that may not matter. Does one of our North American readers care to comment on Razorsight’s performance in the market?

Comments are closed.