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Barnes & Noble Sued Over E-Reader

Spring Design claims the bookseller stole its trade secrets and used them in the Nook e-book reader.

Barnes & Noble Nook eBook Reader
(click image for larger view)
Barnes & Noble Nook eBook Reader
E-reader maker Spring Design has sued Barnes & Noble, claiming the bookseller stole its trade secrets and used them in the recently introduced Nook.

The lawsuit was filed late Monday in U.S. District Court in San Francisco. Spring Design, which unveiled its Alex e-reader Oct. 19, the day before Barnes & Noble introduced the Nook, claims the retailer used features from the Alex that the companies discussed in many meetings, conference calls, and e-mails starting early this year.

In using those features, Barnes & Noble "misappropriated trade secrets and violated the parties' non-disclosure agreement," Spring Design said in a statement. Features that Barnes & Noble allegedly copied from the Alex include the dual-screen design that offers a separate color touchscreen for navigation and Web access, and a six-inch, black-and-white electronic paper display for reading e-books. In addition, both devices are based on Google's Android operating system.

"As a matter of company policy, Barnes & Noble does not comment on litigation," a Barnes & Noble spokeswoman said Tuesday in an e-mail to InformationWeek.

Spring Design claims that during its NDA-covered communications with Barnes & Noble, the bookseller's marketing and technical executives "extolled Alex's 'innovative' features, never mentioning their use of those features until the public disclosure of the Nook."

But despite the suit, Spring Design told InformationWeek it was still willing to work with Barnes & Noble.

"We are interested in working together to develop the market synergistically and not competitively," Eric Kmiec, VP of sales and marketing, said in an e-mail. "We do not want B&N to offer a look a-like product that confuses the market, targeting the same sector of customers and utilizing the confidential information they had on Alex."

Spring Design has yet to say when it would ship the Alex. In unveiling the product, the company said it was in discussion with potential partners, but did not say when the Alex would be available. Barnes & Noble is taking pre-orders for the Nook, which is set to ship at the end of this month.

If Spring Design releases a product, the company will face a crowded market that includes not just the Nook, but Amazon's Kindle and Sony Reader. Amazon currently accounts for 70% of e-reader sales, according to Forrester Research.

Nevertheless, the market is young and growing. Forrester expects e-reader sales this year to reach 3 million units. E-reader sales next year could exceed 6 million units, according to the researcher.

InformationWeek Analytics outlines the 10 questions you need to ask to see where netbooks fit within your organization. Download the report here (registration required).

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