Halogen Settles Lawsuit, Admits Trying to Scam SuccessFactors

Halogen and SuccessFactors have settled their lawsuit, with Halogen paying its competitor in the HR software business an undisclosed sum and admitting it created a bogus company to scam information.

It probably was inevitable that the Ottawa, Canada, company would want to settle the case. From the evidence SuccessFactors allegedly had, Halogen, if not caught red-handed, certainly had a lot of explaining to do. Plus, the whole episode was embarrassing, made for very bad PR, and, as I said when the news first broke, it made a mockery of Halogen’s social responsibility statement.

The background of the case is here. Briefly though, what happened is Halogen created a bogus company posing as a potential talent management software buyer. An Anna Rodrgiuez, the supposed HR lead of the b0gus company, had multiple conversations with SuccessFactors, eliciting what the company said was proprietary information about product capability and pricing.

Anna, however, not only scammed SuccessFactors, but also wandered the aisles of last fall’s HR Tech show in Chicago, chatting up other vendors, including Sonar 6. (Unlike SuccessFactors, which evidently failed to do much in the way of qualifying the bogus firm, Sonar 6 became suspicious early on.)

SuccessFactors filed the suit in December. Not long after, Halogen agreed to a restraining order prohibiting it from disclosing or using any of the information. Still later, as its hometown newspaper, the Ottawa Citizen, reported, it sought to dismiss the whole thing, saying that even if it had done everything SuccessFactors claimed, it didn’t break any laws, contracts, or agreements.

With last week’s settlement, Halogen now is on the record, in court and in the court of public opinion, as admitting ethical violations. Says the settlement announcement:

Halogen acknowledges that it engaged in false pretexting. Specifically, Halogen manufactured a phony prospective customer, “The Magnus Group,” to inappropriately obtain SuccessFactors’ business information to learn about SuccessFactors’ services and product features, product demonstrations, pricing, and sales processes.