Auto software rivals Pentana Solutions and Titan Dealer Managment’s court stoush

Two software firms at war over claims of misuse of market power and deceptive conduct could set a precedent for how a car dealership data is managed in Australia.

Titan DMS managing director Matthew Kroll. Source: Supplied.

Two Australian software firms are gearing up for a showdown in the Federal Court, with automotive IT giant Pentana Solutions and relative minnow Titan Dealer Management Solutions at war over claims over misuse of market power and misleading and deceptive conduct.

Pentana has lobbed claims of copyright and intellectual property infringement at its smaller Queensland-based rival Titan, which alleges in a counterclaim that Pentana, which holds about 70 per cent of Australia’s automotive software market and is the largest provider across the Asia Pacific region, has sought to prevent dealerships from extracting their own data from Pentana’s software.

Titan also alleges that Pentana has used excessive payout figures to prevent dealerships from considering switching to alternative software providers, including amounts over $100,000 and as high as $870,000.

“In the course of providing DMS [dealer management system] products to dealerships in Australia, Pentana has represented to dealerships that they were contractually obliged to make certain payments to Pentana, when no such contractual obligations applied to those dealerships,“ Titan’s Federal Court claim reads.

The company also says Pentana threatened dealerships with breach of copyright if they moved their data across from Pentana’s systems to Titan’s.

The case has significant ramifications for the industry, including promoting better competition among dealership IT suppliers according to Titan managing director Matthew Kroll.

He said following similar cases in the US, legislation was introduced to crack-down on anti-competitive practices relating to dealership data.

The case should set a precedent for how car dealership data is managed moving forward, he said in an interview.

Titan is seeking an injunction against Pentana to stop the alleged conduct as well as damages and legal costs.

The Federal Court is yet to set a date for the matters.

“Things have just got to a point where we really need to take a stand,” Mr Kroll said.

“Obviously, we are the smaller provider in this and we do feel like we were at a point where we’re being disadvantaged, from just being able to compete freely within the market. What we’re really after out of this is the ability to do so.

“We’ve experienced and uncovered substantial evidence that we’re bringing against Pentana, but we expect that the evidence that we’ve uncovered might just be scratching the surface. “And as a result of this, we’re really wanting to hear from other dealerships or manufacturers that have experienced some of what we’re mitigating against.”

Pentana’s chief financial officer Stefan Grammenos declined an interview but issued a statement.

“Pentana Solutions did initiate proceedings in the Federal Court and denies the allegations in Titan’s cross claim and is vigorously defending those claims,” Mr Grammenos said.

“With data security and access to Intellectual Property at the forefront of everyone’s mind in today’s climate, protecting dealers’ and the industries’ data is a priority, which we take seriously.

“Pentana Solutions has built great trust with the industry in this area over the past 48 years and will continue to serve its needs to the highest standard. Pentana Solutions is proud of the relationship with its dealers and the industry, and always has and always will respect and defend its and our partners intellectual property.

“Pentana Solutions makes no further comment on current legal proceedings, as they are still before the courts.”