Lightning Labs, a Bitcoin 26,057 software business, and Tari Labs, a blockchain startup, have agreed to convert a court-ordered temporary restraining order that has halted the development of Lightning’s Taro protocol.
Lightning and Tari’s attorneys requested modifying the restraining order to a preliminary injunction — a temporary order that restricts a party from conducting specific acts — in a March 15 filing. The change of the order to a preliminary injunction would halt the protocol’s development until a judicial ruling is made.
The two companies agreed that Lightning would not produce Taro protocol upgrades, would not combine internal updates with the protocol’s public-facing open-source code, and would not be able to publish or otherwise launch “the next step or’milestone’ of the TARO protocol.”
Lightning was allowed to reply to communications from non-Lightning developers and users as long as the conversations did not enhance Taro’s development.
It might also refer to Taro as the “previous name of the protocol” in announcements about renaming the protocol, as long as it wasn’t “confusingly similar” to Taro or Tari.
Tari Labs filed the temporary restraining order on March 13 after claiming that the word “Taro” infringed on its trademark rights since it was too close to its own protocol entitled “Tari” — a registered trademark in the United States.
As a result, Lightning Labs has been unable to make Any protocol upgrades or changes.
Tari Labs originally filed a trademark infringement action against Lightning Labs on December 8, stating that both companies “operate in the same digital blockchain environment” and offer similar, “in some cases identical,” services.
Both companies “market to comparable developers and users and appear on the same blockchain platforms,” according to Tari.
The restraining order sparked outrage on Twitter. Tari Labs co-founder Riccardo Spagni defended the lawsuit in a March 15 tweet, claiming that the letters “I” and “O” on a computer keyboard are near enough together to cause misunderstanding and that Tari offered to support Taro’s rebranding a year ago. Skype co-founder Naveen Jain justified the action in the same way, saying that “it’s hard to label anything ‘frivolous’ when a judge imposes a temporary restraining order in your favor.”
Lightning Labs creates software for the Lightning Network, a Layer 2 solution for the Bitcoin blockchain that enables for cheaper and quicker transactions than the base layer. The Taro protocol, launched on April 5 as part of a $70 million fundraising round, intends to build on Bitcoin’s Taproot update and allow stablecoins to be exchanged over the Lightning Network.
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