A Texas jury has returned a $706-million judgment against a Detroit-based title company affiliated with Quicken Loans, finding that it ripped off a small real estate data startup.
On Wednesday, a 12-person jury in a state district court in Bexar County, Texas, found that Detroit-based Title Source _ rebranded last month as Amrock _ stole data from startup firm HouseCanary and engaged in fraud by stealing the firm's trade secrets for its own use.
The jury awarded HouseCanary $706.2 million at the conclusion of the seven-week trial: $235 million for fraud and misappropriating trade secrets and $471 million in punitive damages.
Amrock issued a statement Thursday that it will appeal the verdict.
"Yesterday's verdict is a travesty of justice," Amrock CEO Jeff Eisenshtadt said in the statement.
"The jury's decision defies logic; Amrock never received any working software from HouseCanary, instead receiving wireframes and half-developed apps that were completely unusable by the company," the statement added. "After HouseCanary breached its contract, we ended our relationship with the company and were forced to develop our own tool in-house."
The case dates to 2015, when Title Source contracted with San Francisco-based HouseCanary to develop software to make appraisal and real estate valuations.
Title Source did not pay the firm for the work and sued HouseCanary to not pay the annual $5 million in contract fees. Title Source claimed it never received any working software.
HouseCanary countersued, and, its attorneys say, discovered that Title Source misappropriated its trade secrets, a violation of nondisclosure agreements between the companies.
HouseCanary says that the trade secrets relate to its technology for providing automated property valuations and that Title Source actually used these products every day.
The startup also claims that Title Source officials later "lied under oath" by saying they weren't trying to develop their own version of HouseCanary's technology.
"Title Source and its family of companies (including Quicken Loans) wanted access to HouseCanary's technology and data to develop its own competing analytics and software," HouseCanary's attorneys said Thursday in a news release about the verdict.
Now known as Amrock, it is the exclusive title company in the Quicken Loans family of companies. It describes itself as the country's largest independent provider of title insurance, property evaluations and settlement services.
