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Avant! v. Cadence Continues Avant! may need trust fund, as civil case faces delay By Richard Goering, EE Times Fremont, Calif. -- Avant! Corp. will probably be able to delay its civil case with Cadence Design Systems (San Jose, Calif.) but may have to post a bond or set up a trust fund, according to participants in a hearing last week. Separately, the Santa Clara County, Calif., district attorney's office issued a stern response to Avant!'s motion to disqualify the district attorney from the criminal case. Avant! is battling a civil suit filed by Cadence and criminal indictments from Santa Clara County, both alleging theft of Cadence's IC-CAD source code. Avant! asked for a stay in the civil case after the April indictments of president Gerry Hsu and six other individuals. The company also filed a recusal motion asking for the district attorney's dismissal. A hearing on that motion begins July 28. Matt Lifschultz, director of corporate communications for Avant!, said it's "standard practice" to ask for a stay in a civil case when a parallel criminal case is under way. Cadence agreed that the civil case against Avant! executives could be delayed, but argued that the case against the company should go forward. Both Lifschultz and Smith McKeithen, Cadence vice president and general counsel, agreed that U.S. district judge Ronald Whyte appears likely to grant Avant!'s request. But at the same time, Whyte suggested that Avant! may need to post a bond or trust fund to guarantee its ability to pay Cadence if a judgment goes in Cadence's favor. Both companies were asked to file sealed proposals for such a fund last week. Avant!'s recusal motion was based on claims of a financial relationship between Cadence and the district attorney's office. Specifically, Lifschultz charged, the district attorney relied on expert witnesses paid by Cadence, and Cadence lent a Sun workstation to the district attorney's office. The district attorney's office issued a response denouncing the "hysteria and histrionics" in the Avant! motion. "Cadence has done no more with respect to this investigation than to provide information in the manner common to all victims of an alleged crime," the statement says. "There is no financial relationship of any kind between the DA and Cadence." A supporting affidavit was filed by Daniel Lungren, attorney general for the state of California, asking that the recusal motion be denied. A statement filed by deputy district attorney Julius Finkelstein emphasizes that his office used the testimony of expert witnesses from both Cadence and Avant!, and emphasizes that the Sun workstation was a loan, not a gift, and that its only purpose is to examine evidence in the case. Avant!'s legal woes don't seem to be affecting its bottom line. The company last week reported second-quarter revenues of $34.5 million, an increase of 34 percent over the previous year's, and net income of $7.6 million. Cadence, for its part, announced an $18 million contract with NEC Corp. for IC CAD tools.
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