March 10 - The U.S. Supreme Court on Monday declined to

take up a contract dispute between IBM ( IBM ) and rival BMC

Software that previously resulted in a $1.6 billion judgment for

BMC.

BMC had asked the justices to reconsider a U.S. appeals

court's decision that overturned its win against IBM ( IBM ). BMC had

persuaded a lower court judge that IBM ( IBM ) unlawfully replaced BMC's

mainframe software at AT&T ( T ) with its own, but the 5th U.S.

Circuit Court of Appeals threw out the award last year, ruling

that BMC had "lost out to IBM ( IBM ) fair and square."

Spokespeople and attorneys for BMC and IBM ( IBM ) did not

immediately respond to requests for comment. Spokespeople for

AT&T ( T ), which was not involved in the case, also did not respond

to a request for comment.

Houston-based BMC develops and licenses proprietary

mainframe software products. BMC and IBM ( IBM ) had an agreement that

allowed the latter to maintain mainframes running BMC software

with a "non-displacement" provision, which limited IBM ( IBM ) from

switching BMC clients' software to its own software.

AT&T ( T ) hired IBM ( IBM ) to manage its mainframe operations. BMC filed

a lawsuit in Houston federal court accusing IBM ( IBM ) of breaching

their contract when AT&T ( T ) abandoned its software for IBM's ( IBM ).

U.S. District Judge Gray Miller said in 2022 that IBM ( IBM ) owed

BMC $1.6 billion in damages for breaking the agreement. Miller

said IBM ( IBM ) had secretly agreed to replace BMC's software at AT&T ( T )

when it negotiated the non-displacement provision in 2015.

The 5th Circuit overturned the decision in April last year,

finding that AT&T ( T ) chose to replace its mainframe software

independently of IBM's ( IBM ) influence.

BMC argued in its Supreme Court appeal that the 5th

Circuit's decision would "do lasting damage to businesses

throughout the Fifth Circuit - especially in the technology

space, where license restrictions are common and necessary."

IBM ( IBM ) asked the justices to deny BMC's petition and "bring

BMC's quest to revive a windfall judgment to a definitive end."

The case is BMC Software Inc v. International Business

Machines Corp ( IBM ), U.S. Supreme Court, No. 24-569.

For BMC: Jeff Oldham of Bracewell

For IBM ( IBM ): Paul Clement of Clement & Murphy

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