SpaceX Wins First Round in Poaching Case

SANTA ANA, Calif. (CN) - Five engineers can keep working for Elon Musk's space transport company SpaceX after an Orange County Superior Court judge denied Broadcom's attempt to prevent them from doing so.

Orange County Superior Court Judge Randall Sherman denied Broadcom's motion for a temporary restraining order that sought to bar five engineers formerly employed at the semiconductor vendor from working at SpaceX, claiming the individuals would be in a position to divulge Broadcom's trade secrets.

The motion stems from a lawsuit filed March 23 by Broadcom claiming SpaceX poached the five engineers as a means "to procure a family of sophisticated, customized computer chips without bearing all of the research and development costs inevitably involved in creating such chips."

SpaceX denied the allegations in a statement provided to Courthouse News.

"SpaceX did not pursue or lure engineers from Broadcom," the company said through a spokesman. "On the contrary, these engineers reached out to SpaceX anticipating significant layoffs at the Broadcom Irvine location."

Alireza Tarighat, one of the engineers in question, was "profoundly unhappy" with his position at Broadcom and approached SpaceX about joining a project team to be based in Irvine, he said in a March 24 declaration.

Space Exploration Technologies Corporation, more commonly known as SpaceX, was co-founded by futurist and entrepreneur Elon Musk with the goal of reducing space transport costs so humankind can eventually colonize Mars.

In 2014, SpaceX approached Broadcom expressing interest in contracting the semiconductor vendor to design and construct a series of advanced computer chips necessary to accomplish an undisclosed project.

Broadcom says in its complaint that SpaceX was particularly interested in radio frequency engineers who could work on emerging technologies not yet widely known in the semiconductor industry.

In its lawsuit, Broadcom says it established a team of its highest-performing engineers to work exclusively on the project, investing hundreds of hours into the development of an array of technology solutions for Space X in the hopes it could secure a multi-year contract to provide computer chips to the space transport company. The two companies signed a nondisclosure agreement so they could freely exchange ideas as they worked toward an agreement.

In 2015, Broadcom put a cost proposal before SpaceX, which balked saying costs were too high. Broadcom revised their budget but SpaceX continued to maintain costs were exorbitant, Broadcom's complaint says.

SpaceX refutes this version of events, saying it rejected the contract because it was insufficient.

"Last year, SpaceX spoke with a number of suppliers regarding potential opportunities to support SpaceX operations," the SpaceX spokesman said. "SpaceX reviewed Broadcom's proposal, but ultimately found it lacking and rejected it."

However, Broadcom claims SpaceX used the deal as a means of identifying the chip manufacturer's top talent - and proceeded to poach them, according to its complaint.

Broadcom's co-founder and chief technology officer Henry Samueli met with SpaceX CEO Elon Musk in October 2015 in attempts to solidify an agreement, at which time Musk insisted Broadcom keep its "A-team" on the project, according to the complaint.

But even as Samueli and Musk were meeting, other SpaceX representatives were attempting to uncover the identities of the "A-team" engineers working on the Space X project, Broadcom says in its complaint.

Tarighat was the only one of the five engineers assigned to the project, and the other four requested he forward their resumes to SpaceX upon learning of imminent layoffs, Tarighat said in the declaration.

Broadcom is seeking damages related to the violation of the nondisclosure agreement and unfair competition. The company also says its five former engineers have violated their confidentiality agreements by seeking to divulge trade secrets, a claim which Tarighat refutes in the declaration.

Broadcom is represented by Daniel Pyne of Hopkins & Carley in San Jose, California, who did not respond to a voicemail message requesting comment by press time. Broadcom representatives also did not return emails seeking comment by press time.

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