Alibre Pursues Producers of RaceCAD for Stealing Alibre Design Source Code; Source Code Theft by Former Employee Casts Doubt on Outsourced Software Development in Russia and Other Countries

RICHARDSON, Texas--(BUSINESS WIRE)--Oct. 23, 2003--Alibre Inc. today announced that a former Alibre employee has begun illegally distributing a product called "RaceCAD" which is created from source code for Alibre's product, Alibre Design(TM). In the process of stealing source code from Alibre, the individual responsible for RaceCAD has also stolen software from Alibre's partners based in the United States, France and the United Kingdom. These include Spatial Corporation, based in the U.S. and a division of Dassault Systemes S.A. based in France, D-Cubed Ltd. based in the U.K., the OpenDWG Alliance based in the U.S., among others.

Alibre is initiating criminal and civil action in both the US and Russia through local, state and federal law enforcement agencies, including the FBI, against those behind RaceCAD and those who knowingly participate in this illegal activity. Alibre has contacted the ISPs in Russia who are hosting RaceCAD and requested they stop immediately. In addition, Alibre has posted Google advertisements in both English and Russian to warn those who use the search term, RaceCAD, that it is illegal.

“Clearly RaceCAD's use of ACIS is illegal, not to mention the blatant theft of Alibre Design, and they can be sure we will be working with Alibre to pursue them to the full extent of the law.”

Alibre has inspected the software and found the following evidence. A quick visual inspection of the user interface shows that every element in RaceCAD is identical to that in Alibre Design, down to a pixel-for-pixel match for every icon. Various software components are also identical to those in Alibre Design, including ACIS, the component technology licensed from Spatial. The internal organization of the software including specific class names used in components of the application using Java are the same as those in Alibre Design -- except for the replacement of the name "Alibre" with "RaceCAD." Finally, the distinctive peer-to-peer collaboration capability in Alibre Design, while removed from the graphical user interface of RaceCAD, still exists in the internal structure of the software. These facts and additional proof are available for review on the Alibre web site at www.alibre.com/news/mediaroom/racecad.

"We have had direct contact with an individual involved who is claiming to control distribution of RaceCAD," said J. Paul Grayson, CEO of Alibre, Inc. "Amazingly, he offered to 'settle' with us and discontinue the English version if we gave him the Russian version. Clearly the only thing he is going to get is a stiff penalty and likely jail time. Our message to those who have unknowingly used RaceCAD is that they must remove it from their systems immediately. We're offering a general amnesty to those in Russia who unwittingly downloaded the illegal product and will allow them to use a legal version of Alibre Design for a period of time."

"RaceCAD is not an ACIS licensee, yet their application is based on the ACIS modeling kernel," said Michael Payne, CEO of Spatial Corp, a Dassault Systemes, S.A. company. "Clearly RaceCAD's use of ACIS is illegal, not to mention the blatant theft of Alibre Design, and they can be sure we will be working with Alibre to pursue them to the full extent of the law."

"RaceCAD is being distributed with unlicensed and therefore illegal copies of our software," said John Owen, managing director of D-Cubed Ltd. "We will assist Alibre in pursuing those responsible for pirating our software along with Alibre Design."

"It appears the 'developers' were in such a hurry to complete their piracy, and even though RaceCAD was purported to be originally developed in Russian, a few English words are still scattered about -- the same ones used in Alibre Design," said Joe Greco, a CAD industry expert and author. "It's obvious with even a cursory review that RaceCAD is essentially an unauthorized version of Alibre Design, down to every menu command, icon, and dialog box."

The Global Impact

An economic impact study by IDC released in 2003 by the BSA determined the worldwide piracy rate to be 39%, resulting in loss of revenues to U.S. software developers of $13 billion. The study also found piracy rates of 71% in Eastern Europe, 55% in Asia/Pacific and Latin America, 49% in the Middle East/Africa, and 25% in Western Europe. Even North America, with the lowest rate at 24%, piracy results in losses of $2.3 billion. In addition, the study found that reducing the worldwide piracy rate by 10% could add 1.5 million jobs, increase economic growth by $400 billion and generate $64 billion in new taxes to help governments fund public programs like education, health care and law enforcement.

Outsourcing Risk

With the increasing trend toward outsourcing software development, the risk of intellectual property theft becomes even more pronounced. More and more U.S. firms are outsourcing software development to countries like India and Russia. Gartner estimates that by 2005 thirty percent of Global 2000 companies will have a sourcing strategy that include near shore and offshore solutions. However, thefts such as that associated with RaceCAD could invariably impact that trend.

According to Offshore IT Outsourcing, in Russia alone it is estimated that there are about 7500 programmers that generate revenue of $60 million to $100 million every year. Intel, Motorola and Sun Microsystems each have hundreds of developers in Russia. The downside is that Russian intellectual property laws are not well defined. For software developed outside Russia, the copyright law of the country where it was developed is recognized, but enforcement can be unreliable. For software developed inside Russia the risks are higher and the law is less clear.

"Alibre currently outsources some software development to lower cost countries," said Grayson. "We feel this is a viable strategy for software developers, but not if the risk of theft increases substantially. We encourage software developers and outsourcing organizations in Russia and other countries to police themselves. We hope they will respond as this is clearly a threat to a growing industry in general, and specifically their livelihoods."

About Alibre

Alibre redefines professional 3D CAD with Alibre Design, the low-cost application for 3D parametric solid modeling. Alibre Design lets designers, engineers and their associates create 3D models and 2D associative drawings standalone, or together over the Web, using its integrated online tools to share and edit precise product designs in real time. These tools also allow for advanced support and training directly from the online Alibre Assistant. The application's support for open data standards such as STEP improves data exchange with existing CAD systems. Founded in 1997, Alibre Inc. is privately funded and based in Richardson, Texas. For more information, visit www.alibre.com or call [phone].

Alibre and Alibre Design are trademarks of Alibre Inc. All other marks are the property of their respective holders.