A commercial real estate data company is closing its doors following an extended legal battle with a competitor, according to business news. Connecticut data enthusiasts may be familiar with Xceligent Inc, which has filed for Chapter 7 bankruptcy in the wake of a legal battle with CoStar Group, Inc. CoStar had previously accused Xceligent of corporate espionage.
In Dec. 2016, CoStar went to federal court to sue Xceligent for “widespread” theft of photos and data that were the property of CoStar. Xceligent countersued only seven months later, claiming CoStar had been engaged in anticompetitive activity and attempts to form a monopoly. The companies were engaged in serious negotiations pertaining to both suits when talks broke down.
Xceligent’s parent company, based in England, valued the company’s American interests at zero on Nov. 30. The company’s 250 employees were informed of the liquidation of the company’s assets late on Dec. 14. The company’s founder and his wife, who started the company in 1999, both left the company in Oct. 2017.
Unforeseen business challenges are a cornerstone of American business, as any Connecticut entrepreneur can attest. Sometimes, this translates into challenges of a legal nature, even if the company and its management are not at fault. In cases like these, where costs can mount rapidly with no sight of an end, Chapter 7 bankruptcy can be a good way for such a company to recoup some of its losses. Chapter 7 liquidates assets to pay down creditors, and typically discharges unsecured debt, leaving ownership in a more stable financial situation to pursue new business ventures.
Source: bizjournals.com/kansascity, “Xceligent’s legal fight with CoStar leads to bankruptcy“, Russell Gray, Dec. 15, 2017