SAN FRANCISCO (CN) – During his second day of testimony in the Waymo-Uber trade secrets trial, former Uber CEO Travis Kalanick said the ride-hailing company and Google had a "little brother, big brother" relationship that soured after Uber launched its self-driving car venture with Carnegie Mellon University.
“Larry [Page, Google parent Alphabet CEO] was fairly upset with us about us acquiring the CMU team and starting an autonomous effort for ourselves that competed with what they were doing. He sort of was a little angsty, and said, 'Why are you doing my thing?'" Kalanick testified Wednesday in San Francisco.
Last year, Google's driverless car spinoff Waymo sued Uber and Ottomotto, an autonomous trucking company started by former Waymo engineer Anthony Levandowski. It claims Levandowski downloaded hundreds of thousands of proprietary files from its server before abruptly resigning in January 2016, and used them to start Ottomotto days later. The files include ones related to Waymo’s LiDAR system – a laser-based scanning and mapping technology that helps driverless cars see what's around them.
Uber acquired Ottomotto for $680 million in August 2016, three months after the startup launched publicly. Waymo claims Levandowski and Uber’s senior executives conspired to form and acquire Ottomotto so Uber could get Waymo's trade secrets and "leapfrog" over Waymo's seven-year head-start in developing autonomous cars.
Uber contends Waymo sued on bogus trade-secret claims to put the ride-hail out of business.
But Kalanick said Wednesday the relationship between Uber and Google wasn't always venomous. Google invested in Uber in August 2013, he said, and its general counsel David Drummond has served on Uber’s board of directors.
"Larry Page picked me up in a self-driving car," Kalanick mused about the companies' courtship. "There was a general understanding that Google was doing the self-driving thing and Uber was doing the ride-sharing thing, and maybe we could put something together."
Uber attorney Karen Dunn asked him: "At that time, did you consider Google to be a competitor?"
"I did not," Kalanick replied. But a partnership failed to materialize, with Page rebuffing "constant" attempts to discuss a deal amid rumors Google was going to enter the ride-hailing market.
That's when Uber decided to build driverless cars, Kalanick explained.
"We just weren't getting any traction talking about partnerships, so we then acquired the CMU team in Pittsburgh and started our own autonomous sort of self-driving effort" in 2015, he testified.
After the Ottomotto acquisition, an irate Page accused Kalanick in a meeting of “taking our people, you're taking our IP," Kalanick recounted.
A due-diligence investigation conducted for Uber ahead of the acquisition found Levandowski poached 16 engineers from Waymo to work with him at Ottomotto and Uber, where he was in charge of the self-driving program. Internal Waymo documents show Waymo executives were concerned enough about the flight to Uber that Waymo considered fighting the deal. But Uber contends Waymo ultimately decided to fight back by suing.
"Let me just tell you right up front. Google was concerned about its biggest competitive threat," Uber attorney Bill Carmody told the jury during opening statements.
But Waymo's lawyer Charles Verhoeven pointed to multiple actions by Kalanick which he said show the ousted CEO conspired with Levandowski to take Waymo's trade secrets. According to him, Kalanick signed the acquisition agreement without reading it or a concurrent indemnification deal to protect Levandowski if Google sued him for trade-secret theft.
"You wanted your management to do the deal. 'Tell legal to do the deal, ask them to minimize the risk,'" Verhoeven said. "The risk you wanted to minimize was that you would be sued by Waymo and Google, right?"
Kalanick answered, "There are lots of risks to the deal. That's certainly one of them.”
Later, he explained he anticipated a lawsuit from Google due to Page's reaction to the Carnegie Mellon deal.
"Google was super not happy, unpumped about us doing this," he said. "And so when you acquire a company where a large group of people, you know, come from there, those competitive juices get flowing, and that means a higher likelihood of a lawsuit of some kind."
Carmody is with Susman Godfrey in New York; Dunn with Boies Schiller Flexner in Washington; and Verhoeven with Quinn Emanuel Urquhart & Sullivan in San Francisco.
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