Court Declares Reuters Messaging May No Longer Use FaceTime Technology

The United States District Court for the Southern District of New York today entered judgment in favor of FaceTime Communications, Inc. in a contract dispute with Thomson Reuters Inc. over Reuters' use of FaceTime's intellectual property. According to the court, Thomson Reuters must cease use of FaceTime technology effective August 1, 2008. Since 2006 FaceTime technology has been used in a component of the Reuters Messaging Network that provides instant messaging compliance for its financial customers.

Many financial institutions rely on the Reuters Messaging Compliance Manager to ensure compliance with SEC and Sarbanes-Oxley regulations for logging, archiving and retrieval of electronic communications regarding financial transactions. Reuters has not renewed its license with FaceTime following its expiration on January 31, 2008. After efforts to renegotiate the contract failed, FaceTime filed suit against Reuters to protect its intellectual property rights.

"While we are pleased that FaceTime's intellectual property rights are protected, we are concerned about Reuters' timetable for installing replacement technology in light of its representations to the court as to its ability to provide adequate compliance protection for its customers," said Kailash Ambwani, president and CEO of FaceTime Communications. Ambwani elaborates on the FaceForward blog .

Concern over timing of the technology change is based on Reuters' representations to the court in the lawsuit. Reuters' pleadings, filed earlier this month, state:

     "24.    If Thomson Reuters were suddenly unable to make use of the
             Reuters Messaging compliance product, Thomson Reuters'
             customers would be crippled in their day-to-day business
             operations....

      25.    There is no practical immediate substitute for the Reuters
             Messaging compliance product in the event of any disruption.
             Any development of a suitable replacement (and complete
             transition of existing customers to the new product) would
             take several months (and would involve tremendous expenditure
             of money and labor) for Thomson Reuters to convert to an
             alternative product ..."
             (Decl.of Eran Barak, pp. 6-7; 1:08-cv-4730-CM Document 19)

Today's final judgment declares:

     "1.    The parties' Source Code Licensing Agreement terminated
            effective February 1, 2008.
      2.    Effective February 1, 2008, Reuters cease[d] to be authorized
            to "copy, use, distribute or sublicense the Licensed Material
            or the Derivative Works" (i.e., works created by Reuters that
            incorporate or rely on the Licensed Material) to customers
            ("End Users").
      3.    The contractually permitted "grace period" for continuing use
            of the Licensed Material and/or Derivative Works incorporating
            the Licensed Material by End Users holding existing sublicenses
            expires on July 31, 2008, pursuant to Section 8.4.2 of the
            Agreement."

FaceTime customers can get more information through FaceTime Customer Support at enterprisesupport@facetime.com or by calling toll free in North America at 1-888-349-3223, option 2, or 1 650-631-6400.

About FaceTime Communications

FaceTime Communications enables the safe and productive use of instant messaging, Web usage and Unified Communications platforms. Ranked No. 1 by IDC for four consecutive years, FaceTime's award-winning solutions are used by more than 1,000 customers -- including nine of the 10 largest U.S. banks -- for security, management and compliance of real-time communications. FaceTime supports or has strategic partnerships with all leading public and enterprise instant messaging network providers, including AOL, Google, Microsoft, Yahoo!, Skype, IBM and Jabber.

FaceTime is headquartered in Belmont, Calif. For more information visit http://www.facetime.com or call 888-349-FACE. The FaceForward blog, at http://blog.facetime.com , offers thoughts and views on the changing nature of Internet communications, from the people behind FaceTime.

FaceTime, FaceTime Communications, IMAuditor, GEM, Unified Security Gateway, FaceTime Security Labs, IMPact Index, SpywareGuide.com and the FaceTime logo are registered trademarks and trademarks of FaceTime Communications, Inc. Other trademarks and registered trademarks are the property of their respective owners.

FaceTime Contact: Emily Chamberlin A&R Edelman 650-762-2945 Email Contact