Uber Says It Knew About Theft of Waymo Secrets

SAN FRANCISCO (CN) – Attorneys for Uber acknowledged Tuesday the ride-hail giant knew its embattled former engineer took proprietary information from Google’s autonomous-vehicle arm Waymo before resigning to build self-driving cars for Uber.

The revelation that “people at Uber” saw a due-diligence report proving engineer Anthony Levandowski stole the files came in a hearing before U.S. District Judge William Alsup to work out jury instructions ahead of a highly anticipated December trial in San Francisco.

Waymo had demanded the report, prepared for Uber by digital forensics firm Stroz Friedberg, since the outset of the case. The Google offshoot claimed the report would prove Uber stole its trade secrets, but received it just three weeks before the parties were originally set to go to trial – after Uber and Levandowski unsuccessfully appealed its production.

Alsup expressed dismay over the disclosure by Morrison & Foerster attorney Arturo Gonzalez, one of the attorneys representing Uber and co-defendant Ottomotto, a driverless trucking startup founded by Levandowski.

“I thought you contended that all secrets stayed with Stroz and never got to Uber,” Alsup said. “Who did it get to? Was it more than just the lawyers? Was it before the litigation?”

Boies Schiller Flexner attorney Karen Dunn, who also represents the defendants, clarified only Uber’s in-house lawyers saw the report – a 33-page document summarizing the findings of Stroz’s due-diliegence investigation into Levandowski ahead of Uber’s acquisition of Ottomotto. But, she added, those lawyers didn’t see the report’s exhibits, which Gonzalez said contain the “juicy stuff.”

The Stroz summary, made public by Waymo last month, revealed that although Stroz had confirmed Levandowski took and accessed Waymo’s confidential self-driving car files while working at Ottomotto, it couldn’t confirm whether any of those files made it to Uber.

The disclosure by Gonzalez and Dunn was part of a discussion of a tentative jury instruction regarding the role of Stroz and Morrison & Foerster in the case. If Waymo proves that either firm received its alleged trade secrets during the summer 2016 acquisition, the instruction directs the jury to find that the defendants themselves acquired Waymo’s trade secrets unless they can prove the firms had an obligation not to disclose the secrets to them.

Uber hired Stroz to investigate Levandowski, whom Waymo has accused of stealing its trade secrets and using them to build driverless vehicles for Ottomotto and then Uber after resigning from Waymo in 2016. As part of the investigation, Stroz searched Levandowski’s cellphones and laptops for files he may have taken. Morrison & Foerster advised Uber during the acquisition, and has acknowledged it received a “sliver” of the files Stroz examined.

“Uber is going to want to make the point to the jury that the report got to Uber but the exhibits did not,” Alsup told Uber’s lawyers. “With respect to the exhibits, those could have been given to MoFo [Morrison & Foerster], and MoFo could have described them to – even if not handing them copies – it could have described them to Uber, and therefore, wouldn’t that satisfy the requirement and eliminate any duty not to disclose the facts to the principle? So what do you say to that line of reasoning that arguably the jury could indulge?”

Gonzalez replied, “To be clear, MoFo saw the exhibits. Also, to be clear, MoFo’s communications with the client are privileged.”

The defendants want Alsup to toss the jury instruction, arguing that Stroz or Morrison & Foerster’s knowledge of any alleged trade secrets can’t be imputed to them. Gonzalez repeated that request Tuesday, noting that Waymo said in a Nov. 12 brief that it would not rely on wrongful acquisition by Stroz and Morrison & Foerster to seek damages.

“They made the concession that it didn’t cause them damage. It’s almost irrelevant that they have these documents,” Gonzalez said of the Stroz materials.

“No, it’s not irrelevant,” Alsup countered. “[Jury members] need to distinguish between acquisition, use and disclosure. It will help me on injunctive relief.”

Also Tuesday, the parties argued over a tentative jury instruction guiding jurors on how to differentiate between trade secrets and skills that engineers acquire at work. The instruction applies to engineers who change jobs, and specifically to ex-Waymo engineers who followed Levandowski to Ottomotto.

Waymo contends that trade secrets retained in an engineer’s memory can trigger trade secret liability, while Uber argues that Waymo’s position contradicts California’s policy favoring employee mobility and open competition.

Alsup seemed to side with Uber, questioning whether an engineer can forget on-the-job learning.

“Is the engineer really supposed to get a cranial lobotomy before they go to the next job?” he asked.

“This case presents the right of employees to leave – engineers in particular – to leave their employers and continue their profession at some other company. Waymo wants to shut them down cold.

“It just cannot be the law that they can’t continue to practice their skill and knowledge. And it gets complicated when Waymo deems everything in the universe a trade secret. So I’m sympathetic to the engineer whose trying to make a living and pay the rent.”

 

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