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Cracks Form in Riverstone-Tellabs Relationship

Sun, 09/30/2001 - 8:00pm
Staff

A once promising relationship has made an ugly turn for the litigious.

In dueling lawsuits, Riverstone Networks Inc. last month said it had filed a complaint against Tellabs Inc., claiming that Tellabs failed to fulfill obligations connected to a strategic alliance between the companies.

The complaint, filed in the Superior Court of California in Santa Clara County, alleged that Tellabs failed to make a minimum number of purchases linked to the original agreement.

Riverstone's complaint comes in the wake of one Tellabs filed on Aug. 28 in Cook County, Ill., charging Riverstone with breach of contract, fraud, misappropriation of trade secrets and deceptive trade practices. Tellabs is seeking $10 million plus punitive damages to be determined by a jury, a company spokeswoman said.

Tellabs claimed that Riverstone's products have not met contractual requirements to handle voice traffic, and missed product development milestones.

Further, Tellabs said it will no longer sell the "Cablespan 2700," the result of the original equipment deal with Riverstone.

Under terms of the original deal announced last November, Tellabs agreed to resell Riverstone's cable modem termination system, which is qualified for DOCSIS 1.0 and EuroDOCSIS 1.0 specifications.

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