July 21, 2017 / 2:02 PM / in a month

Arista loses bid to lift import ban in Cisco battle

The logo of Cisco is seen at Mobile World Congress in Barcelona, Spain, February 27, 2017.Eric Gaillard

(Reuters) - The U.S. government on Thursday dealt Arista Networks Inc a loss in its technology dispute with Cisco Systems Inc and refused to set aside an order blocking importation of some of Arista's network switches.

The U.S. International Trade Commission refused to rescind its May 4 ruling that found Arista's switches infringed two Cisco patents and banned Arista from importing the infringing products into the United States.

After the ITC released that decision, a different agency, the U.S. Patent and Trademark Office, said the two Cisco patents are invalid.

Arista urged the ITC to rescind its import ban, saying it would be unfair because the Patent Office invalidated Cisco's patents.

But the ITC said in Thursday's decision that the Patent Office rulings "do not constitute a changed circumstance such that the remedial orders should be rescinded."

Marc Taxay, senior vice president and general counsel of Santa Clara, California-based Arista, said in a statement on Thursday that the company was "deeply disappointed" in the ruling, which he called a departure from established law.

Taxay said Arista will appeal the ruling and will also be releasing modified products to maintain the supply of its products in compliance with the ITC's decision.

Cisco said in a statement on Thursday that the ITC sent a strong message that Arista's "corporate culture of copying," as it said the ITC described it, must stop.

San Jose, California-based Cisco and Arista are fierce competitors in the multibillion-dollar market for ethernet switches that connect computers and servers.

Cisco brought multiple lawsuits against Arista in 2014, alleging it brazenly copied Cisco's intellectual property.

Arista, which was formed by former Cisco employees, has denied the allegations and accused Cisco of a smear campaign and trying to stifle competition.

The ITC ruled last year in a separate lawsuit that Arista infringed Cisco patents relating to managing and securing communications networks. Arista redesigned its switches, and U.S. Customs and Border Protection said in April that the company could resume importing its redesigned products.

Reporting by Jan Wolfe; Editing by W Simon

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