Judge Trims Trade Secrets Case Against Uber

SAN FRANCISCO (CN) – A federal judge dealt multiple blows to Waymo’s trade secrets case against Uber ahead of its December trial, weakening allegations that Uber stole its driverless car technology.

U.S. District Judge William Alsup struck one trade secret Waymo had planned to try for misappropriation, and threw a second one to the jury. In a separate order unsealed Monday, Alsup also excluded Waymo’s damages expert, a significant setback for its case.

The judge also removed Otto Trucking from the trial, ruling that it did not misappropriate any of the nine trade secrets Waymo claims. The holding company for driverless trucks was started by Waymo’s former engineer, Anthony Levandowski, whom Waymo has accused of stealing its trade secrets to design driverless cars for Uber. Ottomotto, which Uber bought from Levandowski for $680,000 in stock, remains in the case.

“In short, the record taken as a whole could not lead a rational jury to find Otto Trucking liable on Waymo’s current trade secret misappropriation claims,” Alsup wrote in an 18-page order. “Waymo’s strongest evidence on misappropriation is about Levandowski, not about Otto Trucking, and as a result of its own litigation strategy, Waymo cannot treat the two as fungible targets.”

Google’s Waymo sued Uber, Ottomotto and Otto Trucking in February, claiming Levandowski downloaded 14,000 trade-secret files from its server just before resigning last year. It claims Uber promptly struck a deal to buy the fledgling company from Levandowski and that it hired him to lead its driverless car efforts using Waymo’s technology.

Waymo asserted 121 trade secrets at the outset of the case, but whittled its list to nine after Alsup ruled that some of them were public knowledge and not in fact trade secrets.

The judge announced a similar conclusion Thursday, striking Waymo’s trade secret 96 – related to a laser circuit board design – as overbroad and a rehash of a trade secret he had earlier struck as public knowledge.

“Insofar as Waymo reformed its asserted trade secret to resurrect asserted trade secret number one, it is rejected again as ‘Optics 101,'” Alsup wrote, adding that Waymo’s sprawling disclosure had “compounded the misery in trying to place arms around the breadth of asserted trade secret number 96.”

He also struck the opinion of Waymo’s trade secrets expert, Dr. Lambertus Hesselink, on trade secret 96, calling his analysis “a trick – smoke and mirrors” that would be “grossly misleading to the jury.” And he excluded its damages expert, Michael Wagner, whose analysis he slammed as “avaricious” and “junk science.”

“Other than grade-school arithmetic, however, he did not apply any coherent principle, methodology, theory, or technique, much less one possessing any discernible indicia of reliability,” Alsup said of Wagner in a 16-page order.

Uber was optimistic about the rulings Friday.

“Waymo’s case continues to shrink,” Matt Kallman, Uber’s spokesman, said in a statement. “After dropping their patent claims, this week Waymo lost one of the trade secrets they claimed was most important, had their damages expert excluded, and saw an entire defendant removed from the case – and all this before the trial has even started.”

Waymo, however, said its case remains strong.

“Physical inspections of Uber’s devices, as well as photos and CAD drawings received during discovery, show Uber is using Waymo’s trade secrets, including copying aspects of Waymo’s LiDAR designs down to the micron,” the company said in a statement. “[W]e look forward to presenting our evidence on multiple trade secrets at trial.”

In removing Otto Trucking from the case, Alsup rejected Waymo’s attempt to hold it liable for misappropriation based on evidence of misappropriation by Levandowski, whom it chose not to sue in order to avoid arbitration.

But he maintained jurisdiction over Otto Trucking in order to award injunctive relief if Waymo prevails at trial. The company may also be included in a subsequent trial if Waymo is allowed to add claims for misappropriation of software-related trade secrets, according to the ruling.

Neel Chatterjee, an attorney with Goodwin Procter who represents Otto Trucking, declined to comment on the ruling.

Also Thursday, Alsup granted in part Waymo’s motion for partial summary judgment on two affirmative defenses, striking Uber’s failure to mitigate defense from trial but allowing its unclean hands defense.

Charles Verhoeven with Quinn Emanuel Urquhart & Sullivan represents Waymo. He did not respond to a request for comment Friday.

Michael Jacobs with Morrison & Foerster represents Uber and Ottomotto. He directed a request for comment to Uber’s Kallman.

 

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