Data#3 gets set to fight DXC Technology in court

Data#3 gets set to fight DXC Technology in court

DXC Technology pulled Data#3 into legal action in October

Laurence Baynham - CEO and Managing Director, Data#3 (Photo - Maria Stefina)

Laurence Baynham - CEO and Managing Director, Data#3 (Photo - Maria Stefina)

Data#3 (ASX:DTL) has confirmed it is readying to defend itself in court against a case launched by DXC Technology earlier this year alleging confidentiality breaches by a number of its former employees.

As reported by ARN in October, DXC Technology pulled Data#3 into the legal action it is taking against several former employees from its Connect business over the alleged breaches.

DXC Technology launched the legal action earlier this year against several members of its Connect business's leadership ranks in Australia who, it is understood, may have been in a position, it is alleged, to migrate, potentially en masse, to fellow systems integrator, Data#3.

Among those at the receiving end of the case, which has been brought by DXC Technology in the NSW Supreme Court, is national solutions manager of the company’s DXC Connect business – formerly UXC Connect – Stephen Deibe, along with former DXC Connect general manager, Rob McCabe.

The seven defendants named in the case are largely from DXC Connect’s leadership and upper management ranks.

It emerged in October that Data#3 had been named as the eighth defendant in the case against Deibe and the other six individuals tangled up in the case.

According to documents filed with the court earlier this year, DXC Technology's legal action dwells largely on alleged contractual breaches associated with its sensitive commercial information and whether it was shared with other parties.

Now, in his presentation to shareholders at the publicly-listed company’s annual general meeting, Data#3 CEO and managing director, Laurence Baynham, has confirmed the company is getting set to fight DXC Technology in court, and perhaps even launch a counter-claim of its own.

“Unfortunately, in early August, a handful of new employees were subjected to legal proceedings brought against them by their former employer, a competitor of Data#3,” Baynham said. “Data#3 has recently been named as a joint defendant, and we are currently preparing a defence to the proceedings.

“We believe the claim that the competitor has raised, lacks merit, and as such the claim will be strenuously defended. We are also considering the basis for a counter-claim as part of this matter,” he said.

Baynham also used Data#3’s AGM to reveal three new major contract wins for the company. These include new deals with copper and gold producer, PanAust, a national real estate company and a blue chip multinational manufacturing and distribution company.

“These all represent multi-year, multimillion-dollar services contracts, and offset the loss of the Ipswitch City Council contract following their decision to transition to another provider,” Baynham said.

At the same time, Baynham touched upon the state of play for the company’s cloud services standing, flagging that it is currently in process of decommissioning the Data#3 Cloud offering and helping its customers to move into either public or private clouds.

“Our newly announced partnership with the global powerhouse CenturyLink is important strategically, as it enables Data#3 to provide scalable, robust and cost effective cloud solutions for our customers that require a hybrid cloud solution. The partnership complements our existing cloud solutions,” he said.

The company revealed in October it had signed a partner agreement with CenturyLink, with the local integrator now offering the US-headquartered telecommunications and IT services provider’s infrastructure-as-a-service (IaaS) via its managed services portfolio.

Additional reporting by Julia Talevski and Samira Sarraf

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