Updates to our Terms of Use

We are updating our Terms of Use. Please carefully review the updated Terms before proceeding to our website.

Wednesday, May 22, 2024 | Back issues
Courthouse News Service Courthouse News Service

Self-Driving Car Secrets, Theft, China and Shadow Companies Feature in Hearing

As companies jockey for position in the race to be the first to bring a fully capable autonomous-vehicle software program to market, two contestants battled it out in San Jose federal court on Thursday. 

SAN JOSE, Calif. (CN) – As companies jockey for position in the race to be the first to bring a fully capable autonomous-vehicle software program to market, two contestants battled it out in San Jose federal court on Thursday.

U.S. District Court Judge Edward Davila presided over a hearing on a preliminary injunction request that featured allegations of software theft, engineers absconding to China with downloaded hard drives, shadow companies, alter egos and puppet CEOs.

At the center of the case is WeRide Corp., a Silicon Valley-based startup attempting to build software capable of allowing vehicles to drive themselves.

WeRide sued Ken Huang, its former director of hardware development, saying he downloaded copious amounts of proprietary information – including vital software code – just days before he unceremonious quit his job and joined a nebulous network of companies formed in China.

The companies in China – called AllRide.AI and Zhong Zhi Xing Technology (ZZX) – began showing off their software capabilities in demonstrations to investors soon after Huang landed with their organizations, and the design features displayed many similarities to WeRide’s product.

Davila already enjoined Huang and the companies from using any code obtained from WeRide, but the company’s attorneys were back in court Thursday asking Davila to extend the injunction to newly formed shadow subsidiaries in America. They singled out a man named Jing Wang.

“If you apply the laws to lies you never get to the truth,” said WeRide attorney Michael LaFond.

WeRide accuses Jing Wang of acting duplicitously when he told the court in a declaration that he had no formal affiliation with ZZX and Allride. In fact, Wang had been receiving biweekly updates from the company’s engineers, participating in meetings with investors, communicating with a company email and allowing his name to be used in official company presentations soliciting investments.

Meanwhile, WeRide accuses AllRide and ZZX of forming a subsidiary company in Silicon Valley called Kaizar three weeks after being sued as a means of hiding its new employees and obscuring its work based on stolen trade secrets.

“They just incorporated a different company and began to shift employees to it,” LaFond said.

The plaintiffs also argued Jing Wang was the architect of the entire scheme, purporting to be uninvolved with any of the companies while he had his wife Rong Wang buy all the shares of the Chinese parent company, Smart Car AI Holdings, which owned all of the aforementioned corporations accused of trade secret theft.

“He created this artifice,” said Claude Stern, another attorney arguing on behalf of WeRide.

In a surprise move, Greg Gilcrhist did not deny Jing Wang had a company email or maintained more than a passing interest in the biweekly engineering reports. Instead, he offered an alternative explanation:

“Jing Wang is the CEO of AllRide,” Gilchrist said.

In his initial declarations made at the beginning of the year, Wang was still considering whether to join AllRide or strike out on his own to establish a competing company, Gilchrist said. However, he was introducing AllRide employees to investors and doing informal work before accepting a formal position recently.

Gilchrist conceded the preliminary injunction now pertains to Wang as the company’s CEO, taking the air out of the hearing as the main object for the plaintiffs was to enjoin Wang along with others previously named.

But Gilchrist also accused WeRide of having ulterior motives in bringing the motion, saying plaintiffs were trying to gin up negative press against AllRide and positive PR for itself as companies “jockeyed for reputational positioning with investors.”

Davila was uncharacteristically silent during the proceedings, asking few questions. He took the matter under submission.

Follow @@MatthewCRenda
Categories / Courts, Technology

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.