Westlake Village-based data storage firm Medea Corp. has sued its former chief technical officer, claiming he violated secrecy agreements and is now working for a competitor, marketing technology he developed for Medea. Michael H. Anderson, the defendant in the lawsuit, has countersued, claiming Medea actually took the technology from him and his current employer, Marina del Rey-based Huge Systems Inc. “We regret that Medea has chosen to compete against us in the courts rather than in the marketplace,” he said “We categorically deny the irresponsible allegations made against us by Medea and intend to vigorously defend ourselves and pursue our own very substantial claims against Medea.” Anderson told the Business Journal the dispute is really over money he says Medea owes him after he left the company because of a disagreement over merger plans. Medea’s suit, filed on Aug. 31 in the Los Angeles Superior Court’s Central District in downtown Los Angeles, seeks a preliminary injunction against Anderson and Huge Systems, along with unspecified damages and compensation. The company would not say how much money it lost due to Anderson’s alleged misconduct. No court date has been set. Anderson was an officer, director and chief engineer for Medea from May 1997 until he left in January 2000 to join Marina Del Rey-based Huge Systems Inc., which also markets data storage equipment and is also named in the suit for misappropriating Medea’s trade secrets and for allegedly engaging in unfair competition. In the lawsuit, Medea accuses Anderson of breach of contract, breach of fiduciary duty, breach of confidence, breach of loyalty and unfair competition. Anderson has denied all of the allegations. Medea spokesman Curtis Chan said company officials would not comment on the litigation. “The suit pretty much says it all,” Chan said. In the lawsuit, Medea accuses Anderson of violating a 1997 agreement that barred him from using confidential company information for personal use. The suit claims Anderson had full access to company trade secrets and other confidential information and used that information to develop, manufacture and market data storage systems similar to those developed by Medea. Anderson, the suit alleges, was hired to design and develop data storage information products, but eventually withheld those products from the company so he could market them under Huge Systems in order to directly compete with Medea. The suit also claims that Anderson and Huge Systems used Medea’s internal sales and marketing information to target and attempt to sell products to Medea’s customers and its distributors. Anderson denies any wrongdoing and claims Medea is using codes and design concepts owned by him, Huge Systems and his own consulting firm Open Storage Architects Inc. or OSA Inc. Medea manufactures multiple disk drive arrays for storing digital video, audio and data, along with a proprietary controller device that allows stored files to be transferred from one computer to another or from one storage array to another. Anderson and his current employer, Huge Systems, have countered with their own lawsuit against Medea, filed on Sept. 18 in the same court as the earlier suit, seeking to end Medea’s right to use OSA’s and Huge’s code and design concepts which, Anderson claims, are incorporated into Medea’s VideoRAID RT, VideoRAID FC, AudioRAID and StreamRAID product lines. Anderson is seeking unspecified damages and payment of nearly $1.5 million representing what he claims is the value of the 1.7 million shares of stock he sold back to the company when it merged with Storage Concepts Inc. of Tustin on July 24. Both sides agree the market value of the Medea stock is about 85 cents per share. “On the day that I was supposed to get paid, I got a lawsuit. I don’t think that was a coincidence,” he said. In his countersuit, Anderson contends that Medea made false statements when it claimed Huge Systems was relying on Medea’s technology for its products. Anderson claims it is Medea that is using technology developed by Huge Systems and OSA. Medea officials would not comment on Anderson’s allegations. Medea was founded in 1996 by Stuart Mabon, former founder of Chatsworth-based Micropolis Corp. Medea, with estimated annual revenues of $25 million, has developed data storage products used by video editors, computer game developers and others to store and manipulate their large data files. Huge Systems was established in 2000 by venture capitalist Tina Bow. Revenue figures for that company were not disclosed.
