Self-Driving Trade Secrets Front and Center at Hearing on Thursday

An Uber driverless car waits in traffic during a test drive in San Francisco, Dec. 13, 2016. (AP Photo/Eric Risberg, File)

SAN JOSE, Calif. (CN) – A federal judge appeared inclined Thursday to let a case involving the theft of self-driving technology trade secrets move forward.

U.S. District Judge Edward Davila did not tip his hand during the hearing in San Jose, but his granting of a preliminary injunction is a strong indication he will let the case survive the pleading stage.

“The standard for preliminary injunction is significantly higher,” said Ryan Landes, attorney for WeRide Corp., a Silicon Valley startup that focuses on developing self-driving technology for cars.

The company claims it holds proprietary information about the implementation of certain aspects of self-driving that allows vehicles to accelerate smoothly, change lanes and avoid pedestrians.

All was well until the company noticed the strange comportment of its director of hardware development Ken Huang, who began downloading enormous troves of data and scrubbing his computers.

Soon after, Huang absconded with USB drives full of WeRide data and joined a nebulous network of companies founded in China called AllRide.AI.Inc and Zhong Zhi Xing Technology Co. Ltd.

Huang’s attorney Lenny Huang argued in court on Thursday that WeRide lacked standing in the case because defendants could not tell if WeRide or its subsidiary or if another company in China was the actual owner of the trade secrets.

“There is a lot of fuzziness,” Huang said. “We don’t know who owns what, so the standing issue hangs over our heads.”

Michael LaFond, also arguing for WeRide, characterized Huang’s standing arguments as irrelevant and applicable to patent cases but not matters involving trade secrets.  

“The defense is willfully misguided on this issue of standing,” he said.

He further argued Huang was “missing the forest for the trees” in saying that video clips of self-driving cars are widely available on the internet. Huang attempted to say that a video plaintiffs showed executing various maneuvers was not enough to demonstrate the theft of trade secrets.

However, the plaintiffs argument is materially different, LaFond said.

They believe that Huang made off with their secrets and gave those secrets to ZZX and AllRide, which then showed a car executing developments that would be impossible to independently develop inside of a 10-month period.

Davila, who granted a preliminary injunction in this case, would appear inclined to agree.

Mehrnaz Smith, attorney for Jin Wa, made more inroads during the hearing, arguing her client Jin Wa, who is accused of soliciting Huang to join ZZX, is being included in a guilt by association scheme by the plaintiffs.

“They’re trying to equate our client with KH,” Smith said during the proceeding. “But it’s all just speculation and conjecture.”

Landes appeared to concede that the evidence against Jin Wang as presented in the current complaint is rather thin, but said they have additional facts to prove their accusations as they have begun the preliminary discovery process.

Regardless, the case has major implications for the field of self-driving technology, which many believe is one of the most competitive and secretive fields in the private sector at present.

This case is one of many where engineers or software developers are accused of absconding from companies with proprietary information in quest of higher paychecks and greater autonomy.

Davila took the matter under submission and is expected to rule within the next couple months.

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