Nortel Networks has sued Arbinet-thexchange, alleging copyright infringement and misappropriation of trade secrets through the unauthorised use of Nortel Networks proprietary software.
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Nortel also alleges in the lawsuit that Arbinet exceeded its permitted usage level under its "right to use" licence and has not met contractual obligations regarding the purchase of "certain switching systems".
Nortel filed the lawsuit after the companies engaged in a "lengthy period of unsuccessful discussions" but failed to reach an agreement, Nortel said.
Arbinet runs an electronic marketplace for telecommunications service providers to trade voice traffic and internet capacity.
"Nortel is sending a clear signal that we will vigorously defend our technology investments," a Nortel spokeswoman said,
Nortel's complaint alleges that Arbinet failed to purchase certain telecommunication switches and/or hardware from or certified by Nortel, in order to use Nortel copyrighted and proprietary software at our Los Angeles, London, and New York EDPs (exchange deliver points).
The complaint seeks injunctive relief to prevent Arbinet from using Nortel software, actual and exemplary damages and attorneys fees and estimated costs of about $6m, plus certain software fees.
Arbinet said in its filing to the US Securities and Exchange Commission it has entered into settlement discussions with Nortel to resolve all disputes between the parties.
An Arbinet spokesman declined to comment on whether the settlement discussions with Nortel are still ongoing or had broken down.
Juan Carlos Perez writes for IDG News Service