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A10 Networks Customers Not Impacted by Narrow Patent Injunction in Brocade Ruling

A10 Networks™, the technology leader in Application Networking, announced that on January 10, 2013, Magistrate Judge Paul Grewal of the U.S. District Court for the Northern District of California granted A10's motion for a new trial on patent damages and rejected Brocade Communications Systems Inc.'s ("Brocade") request for a broad injunction on the basis that it "overreaches." The Court instead entered a narrowly-tailored injunction against certain products. The Court explicitly held that "[c]ustomers of A10 who have already purchased and continue to use infringing AX Series devices shall not be affected by this injunction." A10 Networks will appeal to the U.S. Court of Appeals for the Federal Circuit to overturn the jury's verdict.

Existing customers and users can continue to use and receive support for their current AX products. The Court also held that "if A10 can design around the infringing features, A10 may continue to sell the AX Series without the infringing software," and the public "may continue to enjoy the non-infringing features of the product." To that end, A10 has completed development and testing of applicable, non-infringing elements, and will ship AX Series products with the redesigned software immediately.

"We are our industry's leading innovator, and this ruling will not affect our customers, our partners, or our progress," said Lee Chen, CEO of A10 Networks. "We have already designed around the issue, completed rigorous testing of non-infringing software, and will ship AX Series products immediately to serve our outgoing and future orders."

While the court also denied A10's motion to vacate the liability and damages awarded on Brocade's copyright infringement claim, A10 has long since replaced the allegedly infringing code, and will appeal the damages award.

The ruling will have no material negative impact on A10's business or financial strength. "The financial markets recognize the strength of our cash position, our customer base, and our customer and innovation pipeline," added Greg Straughn, CFO of A10 Networks. "We therefore have substantial access to the debt and equity markets should that ever become helpful."

A10 has always acted lawfully and properly, and it will appeal the jury's verdict and the court's rulings before the Federal Circuit. The U.S. Patent & Trademark Office has already rejected the patents that Brocade asserted in their reexamination procedure, and the Federal Circuit will take that into account in its analysis upon our appeal.

A10 Networks' novel architecture and innovations in Layer 4-7 Application Delivery Controllers (ADCs) has led to the success of its products, including the AX Series product line. A10 Networks' unique platforms and technology deliver industry-leading Application Networking solutions that accelerate, optimize, and secure customers' web sites and applications. A10's flagship AX Series platforms deliver solutions for Application Delivery/Server Load Balancing, IPv6 Migration, and Cloud Computing & Virtualization. A10 Networks' products are deployed across numerous verticals, including customers of all sizes in the service provider, Web portal, financial, education, manufacturing, technology, and other markets.

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