Facebook has suspended its location-sharing feature in Italy after a Milan court ruled last year that the social networking giant had violated competition and copyright laws by effectively copying a similar app from a local startup.

Italian software developer Business Competence filed a lawsuit in 2013, accusing Facebook’s Nearby feature of having copied its Faround application, which helps users locate Facebook friends in the vicinity.

Facebook launched its Nearby feature only months after Faround was included in the social network’s app store in 2012.

The complaint alleged that the two applications were “extremely similar” in their functions and general set-up.

Facebook said it has discontinued offering what it now calls Nearby Places in Italy while it appeals against the court’s ruling.

The court ordered Facebook to suspend Nearby Places in Italy or daily pay a fine of 5,000 euros for copyright infringement and unfair competition. It said that Facebook may have to pay further damages to be determined at a later stage.

Facebook wanted the order put on hold while it awaited a ruling on the merits of the case, but its request was rejected by the court in December. It said on Monday that it is complying with the decision pending its appeal.

Facebook insists that the claims were without merit and the order was wrongly decided, but we have respectfully complied with the order in the interim.

Business Competence’s Faround app was launched in September 2012 and quickly gained popularity among Italian users.

Faround was the most downloaded new social networking app in the country but downloads plunged the month after Facebook launched its own Nearby feature on December 17 of that year.

“It was a big blow to us to see that we were losing everything we had invested (into Faround),” Business Competence Chief Executive Sara Colnago said. It had cost the outfit half a million euros to build the app.