Milestone Systems Prevails in License Dispute With OnSSI

The order comes after Milestone notified the court that OnSSI had made monetary payments to Milestone as required by an arbitration panel.

NEW YORK — A New York federal judge has signed off on a Danish arbitration award in a contractual dispute between Milestone Systems and On-Net Surveillance Systems (OnSSI), settling a court case disputing the foreign panel’s decision.

In a two-page order dated July 12, U.S. District Court judge Jesse M. Furman confirmed two awards in favor of Milestone Systems requiring OnSSI to stop reproducing and distributing certain software owned by Milestone, reports.

The order comes after Milestone notified the court that OnSSI had made monetary payments to Milestone as required by an arbitration panel. The value of the monetary payments were redacted from court documents.

“Consistent with the agreement reached between the parties, OnSSI consents to the filing [of] the accompanying consent order and judgement confirming foreign arbitration awards,” Milestone’s attorney Michael Cardello wrote in a letter to the court.

In 2009, OnSSI and Milestone Systems formed an alliance known as an “ingredient OEM” (original engineering manufacturer) agreement to allow Milestone’s XProtect IP software platform to act as a recording engine for OnSSI’s Ocularis video management platform.

Milestone had contended in the underlying dispute that OnSSI signed a contract to license a version of Milestone’s XProtect video management software (VMS) to purchasers of OnSSI camera systems in 2009, but quit the original equipment manufacturer agreement in 2014 after falling behind on payments and so-called minimum purchase obligations.

But OnSSI said it started missing those targets only after Milestone began hiring away OnSSI’s best sales representatives and going after its customers in the U.S., using information gleaned from the 2009 contract negotiations. The onetime supplier had become a competitor, and Milestone went on to shirk its obligation under a separate, $13 million contract to update the XProtect software used in 9,000 OnSSI customers’ systems, OnSSI claimed.

After a Danish panel found in favor of OnSSI in October 2016, Judge Furman declined Milestone’s petition to enforce a partial award ordering OnSSI to stop licensing the software, after the company indicated it intended to appeal the decision.

However, in May, Milestone notified the court OnSSI was withdrawing its appeal after Danish arbitrators had again ruled in favor of Milestone, this time granting the company additional monetary damages, according to court documents.

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