Pegasystems to Pay $7 Million for Investors’ Trade Secret Claims

Pegasystems Inc. will pay shareholders $7 million to end litigation in Massachusetts state and federal court centering on an alleged corporate espionage scheme launched to steal trade secrets from its rival Appian Corp.

The proposed settlement would resolve shareholder derivative lawsuits that claimed Pegasystem’s board, including chief executive Alan Trefler, “fostered a corporate culture that encouraged and protected illegal activities and unethical conduct in pursuit of profits” in violation of their fiduciary duties to shareholders.

Appian later sued Pegasystems in Virignia state court for the scheme, which included recruiting a developer experienced with Appian’s platform to “clandestinely misappropriate” its trade ...