Eavesdrop NY 18

Friday, November 6, 2009
And justice for all construction data miners?

And justice for all construction data miners?

Industrial Espionage, Mail Fraud, Racketeering, Oh My…

We never thought we’d hear racketeering and construction data in the same sentence, but here it is. In early October, Reed Construction Data filed suit in federal court against a division of McGraw-Hill Construction called Dodge. The suit charges that Dodge has unlawfully accessed confidential and trade-secret information from Reed since 2002 by using a series of fake companies to pose as Reed customers. The lawsuit, filed in U.S. District Court in New York on October 8, seeks an unspecified amount in lost profits and punitive damages, trial by jury, and injunctive relief as a result of Dodge’s misuse of Reed’s proprietary construction-project information. Worse yet, Reed claims, Dodge allegedly manipulated the information to create misleading comparisons between its products and services and Reed’s in an effort to mislead the marketplace.

Actually, it’s about who has the best algorithms when both companies have pretty much the same data. The complaint cites 11 counts of misconduct by Dodge, including fraud, misappropriation of trade secrets and confidential information, unfair competition, tortuous interference with prospective economic advantage, violation of New York’s general business law, violation of the RICO Act, monopolization, attempted monopolization, and unjust enrichment.

Not kidding. Eavesdrop read the entire 60-page complaint on Reed’s website. Riveting, because it names names with adorable code monikers like “straw man,” “the Spy,” and “Mr. X.” These “consultants” reported to the not-so-secretly named director of Competitive Intelligence who, in turn, reported to Norbert Young, the president of McGraw-Hill Construction. Young is the boss of everyone at all of the division’s “content buckets”—Architectural Record, Engineering News-Record, and various regional construction publications. While not exactly a Michael Clayton–esque melodrama in the making, Eavesdrop will try to answer this burning question: If Dodge owns 80 to 90 percent of the construction-data industry, why would it need to spy on anyone?

Could it be related to the competition for the lucrative AIA contract that gives “official AIA Journal” status to one publication? Architectural Record has had the honor since it wrestled it from the now defunct Architecture a decade ago. It’s renew-or-lose time in 2010, and Eavesdrop hears that there are five companies, besides McGraw-Hill, vying for the contract. Bidders must own or be in partnership with a trade-show producer, because the contract includes responsibility for the annual AIA convention. Two other firms meet all the criteria, but we can’t verify if they’re in the running. The plaintiff’s parent company, Reed Elsevier, runs exhibitions and publishes a lot of content, including Interior Design. Ditto Hanley-Wood with its global exhibitions division, Architect magazine, and ArchitectTV. What does it all mean for architects? At the very least, it’ll tell you just how hot it’s going to be at the Miami AIA convention next June.

Send wiretaps and search warrants to shart@archpaper.com

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