Metal X
Markforged has filed a lawsuit against Desktop Metal, citing breach of contract, violations of the Lanham Act, and unfair and deceptive acts and practices under Chapter 93A.
It comes over a year since Desktop Metal sued Markforged for an alleged patent infringement, which Markforged was later cleared of.
Demanding a jury trial, the nature of Markforged’s action consists of a number of grievances which go as far back as the ‘surreptitious’ founding of Desktop Metal in 2015, which occurred while CEO Ric Fulop was still an active Director at Markforged – a ‘flagrant breach of his fiduciary duties owed to Markforged’ – to October 2018 when Markforged’s counterclaims against Desktop Metal resulted in a settlement between the two firms.
Since 2015, Markforged claims that Fulop and his Desktop Metal colleagues have ‘acted like proverbial schoolyard bullies’ culminating in last year’s patent infringement lawsuit. The company says Fulop used his inside knowledge of Markforged to beat it to the financial marketplace to raise funds for the idea to print metal parts on a desktop sized machine – which Markforged claim he has “literally stolen” – and then use some of that funding to sue Markforged 'to drive the company out of business'.
When Markforged were cleared of any wrongdoing this time last year, the company filed counterclaims against Desktop Metal, with the companies returning to court last September. The resulting settlement, agreed in October, contains a mutual non-disparagement clause, with $100,000 in liquidated damages to be assessed for each violation of this agreement.
Markforged is claiming Desktop Metal has breached this non-disparagement clause on a number of occasions, notably in communications with resellers, customers and potential customers. In Markforged’s complaint, Desktop Metal is accused of making false and misleading statements about Markforged’s products, ‘which go well beyond the proverbial rough and tumble’ of market competition, including comments allegedly made by Desktop Metal that the Markforged Metal X system ‘creates a severe contamination risk’ and exposes users to toxic solvents and vapours. Markforged is also claiming that, upon being presented with evidence, Desktop Metal ‘begrudgingly admitted’ to making these claims to value add resellers and then ‘undertook to destroy the marketing materials still in its possession.’
In a statement given to TCT, Markforged has said: “Metal 3D printing is on pace to change manufacturing as we know it, and Markforged is leading the charge. We believe healthy competition is good for the industry, innovation, and—most importantly—customers. Unfortunately, as alleged in our complaint, Desktop Metal has chosen to compete by spreading false information. Markforged is taking this necessary step to ensure customers are making their buying decisions on facts, not lies.”
Meanwhile, Desktop Metal has commented that the company "believes the claims are without merit and will be addressing the allegations in the appropriate forum.”
