IBM is set for a fresh courtroom battle with LzLabs over claims the Swiss software vendor breached its contract terms relating to the purchase of a mainframe system.

The two companies will face off in London’s High Court on Monday after Big Blue launched legal action through its UK business, accusing LzLabs of purchasing an IBM mainframe through a subsidiary, Winsopia, then using it to reverse engine parts of the system.

IBM’s second court case against LzLabs

The lawsuit alleges that LzLabs used the reverse-engineered parts to create its Software Defined Mainframe (SDM) platform, which allows applications designed for mainframes to run on servers based on Intel’s x86 architecture.

By doing this, IBM says LzLabs was in breach of its contract, which prohibits such reverse engineering.

LzLabs was founded in 2011, and launched its first product in 2016, a platform that enabled mainframe workloads written in Cobol or PL/1, to run on x86 servers and Linux.

The company has since updated its products for containerized workloads, and signed up customers including telco Swisscom which, according to LzLabs, "successfully moved its entire mainframe workload of business-critical applications to SDM running on Linux systems in the cloud," without having to recompile it.

This puts the company in competition with IBM, which continues to market mainframe and mainframe modernization through its IBM Z business unit, which saw four percent revenue growth in the last quarter. Though the company doesn’t break out Z’s revenue, its infrastructure business as a whole was worth $3.1 billion in the first three months of the year.

The case for the LzLabs defence

Keen to protect this income stream - and the company’s IP - IBM opened a separate court case against LzLabs in Texas in 2022, alleging patent infringement. In this case, it is seeking damages and an injunction preventing LzLabs from marketing products containing the IBM IP.

It is not clear what remedy IBM is seeking in the London court case. DCD has approached both companies involved requesting comment.

LzLabs is expected to argue that the development of SDM is protected by European and UK laws that promote innovation and competition in the tech industries.

The company will deny any improper activity and will instead state that IBM is trying to suppress a commercial rival.