As expected, a federal court has issued its latest ruling in favor of Avant! Corp in the company’s civil litigation with Cadence Design Systems Inc. Judge Ronald Whyte ruled that Cadence had yet to offer sufficient proof that Avant’s Aquarius chip design software product was based on technology stolen from Cadence. Whyte therefore rejected the motion to issue an injunction on the sale of Aquarius, a course of action that he hinted last month he would take (CI No 3,397). The development amounts to a minor victory for Avant, which had already stopped shipping Aquarius in favor of its next-generation product, Apollo. Nevertheless, Cadence is expected to file more papers within a matter of weeks and request again that the judge issue an injunction against Aquarius – which would force Avant’s customers to stop using the product. The ruling is the latest chapter in a legal saga between the two rivals which has seen Avant executives face criminal proceedings as well as the civil suit from Cadence. Judge Whyte, in issuing the ruling, also kept in force a stay in the proceedings of the civil trial pending the outcome of the criminal one. That could push the trial date back beyond 1999, something which should give investors some justified confidence in Avant, according to Deutsche Morgan Grenfell analyst Steve Fortuna. Fortuna believes that with the civil case farther away the company’s share price should rise over the next several months as investors focus less intensely on litigation issues and more on the company’s solid business fundamentals. He says the second quarter appears to be shaping up nicely, and is maintaining his buy rating on the stock. Analysts surveyed by First Call are looking for earnings of $0.35 per share next quarter. Despite the legal news, Avant shares fell $1.0625 on Wednesday to close at $26.9375.
