Rambler will drop NGINX criminal case

Company says any legal matters will be handled in a civil court, but the case looks dead after a former Rambler CEO shot down Rambler's main argument over the weekend.
Written by Catalin Cimpanu, Contributor
Image: NGINX, ZDNet

Following intense backlash from the open-source and Russian tech communities, Russian internet company Rambler sait it would drop its criminal case against NGINX Inc, the company behind the world's most popular web server.

Instead, Rambler will pursue any ownership claims over the NGINX source code in civil court, a Rambler spokesperson told ZDNet today.

The decision was taken on Monday in a meeting of Rambler's board of directors. The meeting was called by Sberbank, one of Russia's largest banks and Rambler's largest shareholder, with a stake of 46.5% in the company.

Rambler faced a huge backlash in Russia

Sberbank summoned the meeting after a large part of the Russian tech scene protested against Rambler over the weekend, with some websites even staging a 30-minute blackout in support of the NGINX team.

The protests and backlash against Rambler come after last week Russian police raided the Moscow office of NGINX Inc., the company behind the NGINX web server -- a shocking action not seen before in a copyright dispute over an open-source project.

During the raid, police detained and questioned two of the NGINX founders, including the web server's original creator, Igor Sysoev. Both NGINX founders were released on the same day, but had their smartphones seized by Russian police.

The raid was carried out after an investment firm acting with authorization from Rambler filed a criminal complaint, rather than a civil case, against NGINX, claiming that Rambler owned the NGINX project and source code. The main argument was that Sysoev had developed the project while he was working for the company.

Following the raid, the backlash against Rambler was unforgiving, harsh, and immediate, both internationationally and inside Russia.

The entire legal case, and its unusual escalation towards a criminal investigation rather than a regular lawsuit, made zero sense to all third-party observers.

Many pointed to older interviews that Sysoev gave to media outlets, where he claimed on several ocassions that he created NGINX in his free time, and that Rambler wasn't even one of the server's first adopters.

Others pointed out that Rambler only filed the copyright violation complaint after F5 Networks acquired NGINX Inc. for $670 million, a sum larger than Rambler's entire value.

Rambler was accused of a money-grab move because it never cared to impose ownership claims over the NGINX source code in the past 15 years, since the project was first released.

Furthermore, both NGINX Inc. and Rambler went through acquisition processes of their own, during which the question of NGINX's ownership rights was never raised or seen as an issue.

Even Sergey Vasiliev, the Rambler Group CEO at the time of NGINX's creation, aired its displeasure at his former company. In a Facebook post, Vasiliev effectively destroyed any chance of a future criminal investigation when he revealed that both he and other Rambler management personnel were never aware that Rambler was working on NGINX, disproving claims made by Rambler in the criminal complaint.

NGINX co-founder calls raid a money grab

Following his release from custody, Maxim Konovalov, the other NGINX Inc founder arrested last week, called the entire affair an intimidation move and that Rambler never reached out to inquire or air any grievances about a potential copyright violation before the raid last week.

"The big money [from the F5 Networks acquisition] became palpable, and then we see the desire to grab a piece of it for themselves," Konovalov said in his interview. "It's a typical racket. Simple as that."

Rambler's internet rivals also didn't miss a chance to criticize the company. VK, Russia's largest social network, added a "Powered by Nginx" label to all its pages, while fellow social media network Odnoklassniki promoted the #WeAreForOpenSource hashtag on its portal.

Grigory Bakunov, Yandex's Director of Technology Distribution and head of the Yandex.Health service, also posted a message in support of the open-source ecosystem and NGINX.

Rambler might continue in a civil case

All of the negative press coverage eventually forced Rambler to reassess its strategy on Monday. With Sberbank leading the charge, the board of directors unanimously voted to back down from the whole NGINX tire fire.

First, the company voted to dismiss Lynwood Investments, the company that investigated the potential NGINX rights violation on its behalf.

Second, Rambler also promised to reach out to law enforcement and withdraw the criminal complaint filed by Lynwood Investments.

But Rambler also didn't want to seem it was entirely giving up. The company also said it intends to continue looking into a potential rights violation; however, not through a criminal case, but through a civil court, as most of these cases are handled.

"In the modern world, situations of disputes over intellectual property rights are ubiquitous, and it is natural for technology companies to defend their rights, but these issues must be resolved in a civil-law plane," said Lev Khasis, First Deputy Chairman of the Management Board of Sberbank, Chairman of the Board of Directors of Rambler.

"We have been in contact with the founders of Ngnix for several days and will try to help resolve this issue," Khasis added. "Taking this opportunity, I want to emphasize that Rambler, and Sberbank fully support the unanimous position of the Russian technology community regarding open source solutions."

A copy of the Rambler board of directors decisions obtained by ZDNet is available on Scribd, here.

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