Deque Systems Sues Accel-Backed BrowserStack Over IP Theft Allegations

SUMMARY

Deque Systems filed a lawsuit against BrowserStack in the US district court, citing a range of allegations such as copyright infringement, breach of contract, and false advertising

Last month, the firm lodged a complaint with the US District Court for the Eastern District of Virginia

Last year, Bengaluru-based SaaS startup Whatfix had also been dragged to court by its Israeli-origin and Nasdaq-listed rival WalkMe

Virginia-based Deque Systems has filed a lawsuit against SaaS unicorn BrowserStack in the US District Court over allegations of intellectual property (IP) theft.

Deque Systems cited a range of allegations such as copyright infringement, breach of contract and false advertising, Moneycontrol reported.

Last month, the firm lodged a complaint with the US District Court for the Eastern District of Virginia.

According to Deque Systems’ complaint, BrowserStack purportedly entered the accessibility testing market in 2023 with a product resembling ‘axe DevTools browser extension,’ a component of Deque’s proprietary accessibility testing tool.

Accessibility testing is the practice of making your web and mobile apps usable to as many people as possible. It makes apps accessible to those with disabilities, such as vision impairment, hearing disabilities, and other physical or cognitive conditions.

In an interview with financial media platform TearSheet, Preety Kumar, the founder and CEO of Deque Systems, alleged that BrowserStack initially acquired the accessibility testing tool through a purchase but subsequently gained access to the source code.

“BrowserStack is not the only company that checks the products that are out in the market, every company evaluates products through this process,” a source said as quoted in the report.

Founded in 2011, by Ritesh Arora and Nakul Aggarwal, BrowserStack allows developers to build bug-free apps and comprehensively test mobiles and apps through combinations of various digital environment.

The startup is backed by marquee investors such as Accel, BOND, and Insight Partners.

BrowserStack reported a 57% jump in its standalone net profit to INR 75.3 Cr in the financial year 2021-22 (FY22) from INR 47.9 Cr in FY21 on the back of a steady growth in its business. BrowserStack’s operating revenue surged 59% to INR 418.4 Cr in FY22 from INR 263.3 Cr in the prior fiscal year.

Last year, Bengaluru-based SaaS startup Whatfix had also been dragged to court by its Israeli-origin and Nasdaq-listed rival WalkMe.

WalkMe had alleged that the SoftBank and Peak XV Partners-backed startup gained unauthorised access to its systems to interfere with customer relationships. Further, WalkMe alleged that Whatfix tried to make misleading advertising claims about its products and used its design mark without permission.