SAN FRANCISCO (CN) – A federal judge on Monday appeared to walk back his earlier assessment that Uber concealed evidence that delayed a trial over allegations it stole autonomous vehicle trade secrets from rival Waymo.
Last week, U.S. District Judge William Alsup told Uber's top in-house lawyer Angela Padilla that she and other Uber executives could face consequences for failing to disclose allegations that Uber had set up a covert intelligence team to steal trade secrets from Waymo and competitors overseas.
But Alsup struck a conciliatory tone at an evidentiary hearing on Monday, saying Uber may not be to blame after a set of agreed-upon search terms for scouring its email servers failed to turn up messages containing the allegations.
"If it didn't get picked up in one of those categories, you can't accuse the other side of suppressing evidence," he told Waymo's attorneys, referring to the email search terms and to discovery requests for hard-copy documents.
The allegations were made in a sealed demand letter sent to Padilla in May by an attorney for former Uber security manager Richard Jacobs after Jacobs was forced to resign. The letter was obtained by the Justice Department in an unrelated criminal investigation into espionage by Uber, and sent to Alsup on Nov. 22.
Padilla testified last week that she didn't give the 37-page letter to Uber’s in-house lawyers handling Waymo’s lawsuit on trade secret theft claims, or to Uber’s trial counsel at Morrison & Foerster. Instead, she gave it to the company’s compliance team, which opened an internal investigation into the veracity of Jacobs’ allegations.
The compliance team told Padilla not to disclose Jacobs’ “fantastical” allegations until they were substantiated out of concerns of tainting the investigation, she told Alsup. She denied trying to hide the letter, saying she believed it would be discovered in her inbox and produced if it was relevant to the case.
Alsup ultimately tasked Special Master John Cooper, of the firm Farella Braun & Martel, with deciding whether Uber was required to produce the letter and a resignation email, after Waymo's lawyers objected to his conclusion about search terms.
"When the head of litigation has the document in front of her face, you don't need a search term," said David Perlson of Quinn Emanuel Urquhart & Sullivan, representing Waymo.
Cooper's decision, the judge said, would help him decide "how much the jury should learn about these problems Uber is making," which include destruction of evidence and refusing to produce evidence until three weeks before an originally scheduled October trial.
Alsup explained that because the Jacobs Letter is hearsay – which is usually inadmissible as evidence – Waymo will need to present it to the jury some other way.
"If it was concealed, it could come in for cover-up, even if it's not true," he said.
"I want you to know how this argument fits in to the larger picture. It will be a piece of a larger story, and it may influence what the story is or even whether the story gets told to the jury at all."
According to Jacobs, the letter also revealed that Uber stores its competitors’ trade-secret information on computers that bypass its servers, and its employees communicate about the information using Wickr, an encrypted messaging application that erases messages after a certain amount of time.
Uber says it is innocent because Waymo’s trade secrets never made it to its servers; multiple searches failed to find any. But the letter, portions of which were read aloud in court, states Uber used the tactics to keep trade secrets off its servers so it could avoid disclosing them in civil and criminal cases.
In her testimony, Padilla called Jacobs an “extortionist” looking for a payout. She said Uber voluntarily disclosed his letter to the Justice Department in June to pre-empt his allegations, and that he was fired for downloading confidential documents to his personal email account in order to blow the whistle on Uber. Nonetheless, the company settled Jacobs' employment claims in August for $4.5 million and hired him to consult for it on issues surrounding them.
His lawyer’s letter says he was demoted and then fired for not cooperating sufficiently with Uber’s policy of hiding evidence from discovery.
The trial, which was set to begin Tuesday, has been delayed until February so Waymo can gather evidence about the allegations.
Waymo sued Uber and co-defendant Ottomotto, a driverless trucking startup founded by former Waymo engineer Anthony Levandowski, this past February. The Google spinoff claims Levandowski downloaded 14,000 of its trade-secret files before resigning in January 2016 to start Ottomotto, and that Uber quickly struck a deal to buy the company and hire him to build autonomous vehicles using Waymo’s technology.
Uber is represented by Arturo Gonzalez of Morrison & Foerster in San Francisco.