On Wednesday, a judge for the International Trade Commission will issue its first ruling on if Arista Networks has infringed on Cisco’s patents, and the folks inside Cisco are eagerly hoping things will go their way.
If the judge rules in Cisco’s favor, then Cisco hopes the judge will tell Arista it can’t ship its networking switch products into the US from its overseas manufacturing sites until the technology in question is removed.
Such a ban could be imposed in a couple of months.
As we previously reported, the legal fight between Cisco and Arista is downright personal because Arista is a company largely built by ex-Cisco folks.
That’s a lot of “ifs”
Even if none of this goes Cisco’s way, Cisco has more lawsuits against its hated rival in the works.
It has another whole round with the ITC involving another group of patents. That ITC judge is expected to rule on April 26.
Beyond the ITC, Cisco has also filed an patent-infringement lawsuit with the Federal District Court for the Northern District of California. That case has been put on hold pending the outcome with the ITC cases, Cisco says.
Cisco opted to go to the ITC in addition to federal court because the ITC tends to work faster, Cisco lawyer Mark Chandler said.
Meanwhile, Arista’s CEO Jayshree Ullal has been downplaying the effects of all of this litigation.
In a November earnings call Ullal told Wall Street analysts that Arista is preparing for a worst-case scenario and that none of this is scaring customers away.
“The lawsuit has not had a dramatic negative impact on our sales momentum and customer revenue,” she said.
Arista has continued to grow and analysts expect it to report a 38% hike in quarterly revenue when it reports its fourth quarter on Feb. 18.
Preparing for the worst
Arista’s lawyer Marc Taxay also told analysts on that November call that Arista is already working on ways to remove the disputed technology.
“We have actually developed, to greater or lesser degrees, design arounds for each of the patents in the event that there’s an adverse outcome. Some have been implemented already; others are in the process of being implemented,” Taxay said.
Arista was founded by two famous Valley billionaires, Andy Bechtolsheim and David Cheriton, and is run by former star Cisco engineer Ullal, with former Cisco employees all over the company.
Arista has previously admitted that its products imitated Cisco’s by design, so that someone trained to use Cisco’s networking products could easily learn Arista’s. (It takes years of training to master Cisco’s networking products.)
All of that made Cisco’s blood boil.
And then Arista went public in mid-2014 and revealed a healthy, profitable business growing at a fast clip. A few months after its IPO, Cisco filed its suits.