A federal judge dismissed three counts against D-Link Systems Inc. in Fountain Valley levied by the Federal Trade Commission alleging security lapses in its consumer router and IP cameras.
The court dismissed the FTC’s “unfairness” claim due to an “absence of any concrete facts” concerning allegations of potential consumer harm.
“We look forward to addressing any amendment to the Complaint and will continue to vigorously defend D-Link Systems against what we believe to be a baseless and unwarranted lawsuit,” Patrick Massari, assistant vice president at the Cause of Action Institute, told the Business Journal in an email.
The companies retained the Washington, D.C.-based Cause of Action Institute to defend against the complaint. The institute defended similar claims against Atlanta-based LabMD and ultimately sued the FTC. Several motions in the dispute remain unresolved.
The FTC in a January complaint alleged D-Link, the North American unit of Taiwan-based parent D-Link Corp., violated an unfairness and deception clause of the FTC Act for failing to implement reasonable practices to secure wireless routers.
In May a U.S. district judge instructed the FTC to dismiss the case against the parent company, leaving the U.S. subsidiary as the sole defendant in a case alleging it “failed to take reasonable steps to secure the software for their routers and IP cameras” against hacking methods.
D-Link Corp. had rejected the FTC claims, a rare move, considering most companies tend to quickly settle those types of allegations.
It generates about $1 billion in annual sales.
Veracity Raises Cash
Aliso Viejo-based Veracity Industrial Networks, a newcomer to Orange County’s burgeoning cybersecurity hub, closed a $1.5 million seed D round.
Investors included prior backers Microsemi Corp., which houses Veracity at its headquarters, and Hollencrest Capital Management. Schweitzer Engineering Laboratories in Washington state is a new strategic investor.
Veracity said it plans to use the proceeds to ramp up development and production of next-generation technologies for industrial cybersecurity products targeting critical infrastructure, such as power plants and water treatment facilities.
It’s in a pilot program with Schweitzer to supply the manufacturer with a turn-key software platform that secures devices at a network in a day or two rather than replacing and upgrading them throughout the network endpoint, which can take as long as 18 months.
Veracity is in line for nearly half of a $4 million project awarded to Schweitzer by the U.S. Department of Energy for its Chess Master project to secure industrial control systems. Partners Ameren Corp. and Sempra Energy are providing test cases for a commercial product.
Veracity has raised $4.5 million since its 2014 inception and is seeking its first Series A venture capital round of about $8 million.
In other company news, Doug Lawson, chief executive of San Juan Capistrano startup ThinkIQ, joined Veracity’s board.
Lawson was founder and chief executive of Mission Viejo-based Incuity Software Inc., which was acquired in 2008 on undisclosed financial terms by Rockwell Automation Inc., a Milwaukee provider of industrial automation power, control and information systems.
Smart Sales
Another iPhone model, another round of speedy design development and production cycles for OC’s bevy of smartphone accessories makers.
The latest model from Apple Inc. features a faster processor, glass body, upgraded camera, louder speakers and wireless charging.
The iPhone 8 has a 4.7-inch display, and the 8 Plus has a 5.5-inch display.
The measurements should come as good news for OC’s long list of case, battery and speaker makers, since they match last year’s versions.
Olloclip, a Huntington Beach-based maker of camera accessories, announced that its suite of multipurpose lenses and kits are compatible with both 8 models.
The company, which posts annual sales exceeding $15 million, is developing a product line for Apple’s iPhone X, which has a slightly larger display than the 8 Plus, as well as a 12-megapixel rear camera, 4K video recording, and body and face detection, among several other features. The version starts at $1,000, compared to the iPhone 8 at $699 and the iPhone 8 Plus at $799.
Several local companies have worked their way into the coveted iPhone ecosystem, including Costa Mesa-based high-end headphones maker Audeze LLC; Irvine-based Peri Inc., a startup iPhone charger and speaker maker; Irvine mobile device accessories maker Incipio Group; and the Joy Factory in Irvine, which makes mounts, cases, kiosks and other products.
Perhaps no local company capitalized more on the Apple wave than former Irvine-based chipmaker Broadcom, which built a sizable business on sales of connectivity chips that powered Wi-Fi, GPS and Bluetooth applications for the iPhone and other devices.
The company, which shifted a third of its Irvine operations and more than 800 workers after it was acquired early last year for $37 billion by Avago Technology Inc., now goes by Broadcom Ltd. and has its U.S. base in San Jose.
