A Judge’s ruling on a software copyright case has effectively forced the Royal Bank of Scotland to give up a long running court battle against Complex Systems. Royal Bank of Scotland Group has been forced to settle so that it can use a key piece of software in its trade finance business.
RBS in a statement said the deal would allow it to use the company's BankTrade software and continue processing trade finance transactions across all of its legal entities.
In May, U.S. District Judge Katherine Forrest in Manhattan entered a permanent injunction requiring RBS's ABN Amro unit to stop using the BankTrade software within a year, and not to use it to process new trade finance transactions received 60 days from her decision.
ABN, now called Royal Bank of Scotland NV, had said that the BankTrade software was a "core" feature of its technical platform and said removing it would be like cutting out the system's heart. While it might seem a straight case of “you used it, you pay for it” but actually it was a little more complex than that. The lawsuit, filed in 2008, flowed out of ABN Amro's $21 billion sale in 2007 to Bank of America of LaSalle Bank and a unit that had been licensing BankTrade from Complex Systems.
Forrest said the license went to Bank of America, but RBS kept using the software because an outdated version became a deeply embedded component of a platform used in 22 countries by more than 2,600 clients, processing thousands of transactions a week, she wrote.
However she said that ABN Amro was improperly using the BankTrade software of Complex Systems. The bank appealed and sought to put Forrest's ruling on hold in the meantime. But the 2nd U.S. Circuit Court of Appeals in New York denied the bank's request on June 26.