SAN ANTONIO, Jan. 9, 2019 /PRNewswire/ --HouseCanary, the leading provider of modern valuation and appraisal solutions, prevailed in a crucial decision in litigation in which Amrock (formerly known as Title Source) was found liable for a $740 million judgment from its wrongful conduct, including its massive theft of HouseCanary's intellectual property. Judge David A. Canales denied Amrock's request for a new trial, preserving the unanimous jury verdict from March 2018.
"This was precisely the right decision. During four days of hearings Amrock produced no new information but used the Court's time to parade out so-called 'whistleblowers' who only testified to advance business interests with Amrock and its affiliate Quicken Loans," said Kalpana Srinivasan, partner at Susman Godfrey LLP and counsel to HouseCanary.
Amrock initiated the litigation by suing its business partner HouseCanary in San Antonio for breach of contract, after Amrock unsuccessfully demanded changes to the terms of the parties' contract to try and shield its completed misappropriation. Only after Amrock launched the litigation did HouseCanary discover hidden unproduced evidence exposing that Amrock had actually misappropriated its intellectual property and was using the litigation to conceal its conduct.
Amrock promised that purported new witnesses would reveal false testimony had been given to the Court. However, these alleged whistleblowers knew nothing about the trial or what evidence was put before the Court. The witnesses had not even read the trial transcripts. Amrock's promises were completely untrue.
These witnesses had been on Amrock's trial witness list but Amrock chose not to call them to testify to have their credibility assessed by the jury. At the hearing, each witness simply rehashed Amrock's same disproven story that the jury heard for seven weeks of trial and unanimously rejected, including that HouseCanary did not breach its contract with Amrock.
Although the "whistleblowers" were brought to Court with the promise they would say HouseCanary's technology did not work, they in fact proved the opposite. After they left HouseCanary, two of the terminated employees contracted with HouseCanary for its leading-edge AVM and appraiser technology for their subsequent employers. And one of the witnesses completely destroyed the idea that any company could build an AVM in two months – a story Amrock falsely told the jury during the original trial to claim it had developed its own AVM after it was caught red-handed stealing HouseCanary technology. Recently, after conducting a full investigation, Quicken Loans decided to turn off access to the Amrock AVM derived from HouseCanary's trade secrets.
The hearing established there was no "collusion" between HouseCanary and any Amrock employees. After giving Amrock a full opportunity to present evidence on its motion, the Court rejected Amrock's false claim that its own employees had acted on HouseCanary's behalf and defrauded the Court. Instead, the Court once again affirmed the jury's finding that there was "clear and convincing" evidence that Amrock willfully and maliciously stole HouseCanary's trade secrets. The Court also once again affirmed the jury's finding that HouseCanary met its obligations under the parties' contracts, even though Amrock never paid HouseCanary even one cent before suing HouseCanary.
During hearings in December 2018 and January 2019, each of Amrock's "witnesses" was shown to have clear business and personal ties to Amrock and Quicken Loans, calling into question the veracity of their claims. These "witnesses" included:
Amrock's lead "whistleblower," who admitted that after agreeing to testify in this case, his company – a startup with barely $200,000 raised including from undisclosed cryptocurrency investors – miraculously got a sit-down meeting with Quicken Loans and signed an NDA to discuss a potential business relationship. He initially told the Court he had no contracts with Quicken Loans. He also failed to disclose in his declaration that after leaving HouseCanary, he remained a customer of HouseCanary's technology and even personally signed a contract on behalf of a previous employer with HouseCanary.
An Equifax employee, who revealed that far from blowing a whistle, he had been aggressively contacted by a private investigator hired by Amrock. When that didn't succeed, Quicken Loans' CEO Jay Farner used the company's business relationship with Equifax to pressure him to testify. Quicken Loans is one of Equifax's biggest customers.
A former HouseCanary employee, who also had worked for Quicken Loans and whose wife has worked in the Quicken Loans family of companies for over 20 years, including serving as Chief Information Officer. He was contacted by the General Counsel of Quicken Loans, Angelo Vitale, to pressure him to testify. He admitted that even when he worked for HouseCanary, he "wanted to protect Amrock," broke his confidentiality obligations to HouseCanary by sending confidential information to Amrock executives, and used a personal email account to conceal these disclosures from HouseCanary.
A current competitor to HouseCanary, who admitted that Amrock is a significant customer for which he manages sales. He also said he would rather rely on the declaration drafted for him by Amrock's lawyers – even though it completely omitted mention of his termination by HouseCanary – than his own testimony under oath in court.
"Amrock cannot distract from the fact that it stole HouseCanary's proprietary technology," said Max Tribble, Partner at Susman Godfrey LLP and counsel to HouseCanary. "The jury saw all of the facts and rendered a careful verdict after a seven-week trial, and the attempts by Amrock to nullify the jury's decision were entirely dismissed by the Court after another four days of hearings."
HouseCanary was represented at trial by Max Tribble and Kalpana Srinivasan of Susman Godfrey L.L.P. and Ricardo Cedillo of Davis, Cedillo & Mendoza.