On June 17th, SocialApps opened suit against Zynga for copyright infringement, violation of trade secrets, breach of written contract, breach of implied-in-fact contract, and breach of confidence. SocialApps is the developer behind the Facebook game “myFarm”, which was released in November of 2008. They allege that Zynga stole their source code after SocialApps signed a Letter of Agreement in response to an inquiry about purchasing the intellectual property. This had allowed Zynga to view the code, but shortly after SocialApps lost touch with the company and efforts to contact them were in vain.
Zynga released Farmville on June 19th, 2009; SocialApps claims that Zynga had contacted them about a month before this. SocialApps formally registered their copyright on June 13th, 2011. They seek damages in excess of $100,000, permanent injunction, statutory damages, punitive damages, attorney’s fees, and profits from Farmville. SocialApps also alleges that Zynga has further applied its source code to their FrontierVille, CityVille, and FishVille apps.
Analysis: Given that Zynga just filed an IPO to go public with stock, this is a bad time for them to get hit with something like this. There may or may not be basis to SocialApps’ claim, but their late copyright registration is going to hurt them. However, let’s not forget that back in 2009, Zynga’s CEO admitted to bad business practices.
All in all, speculation over the result of this is futile. Lawsuits like this take a long time, and many of them are without substance.