Uber, Waymo Squabble Over Evidence Ahead of Trade-Secrets Trial

SAN FRANCISCO (CN) – Attorneys for Uber and Waymo clashed Wednesday over what evidence a federal jury will hear at an impending trial over whether Uber swiped its rival’s driverless-car technology.

The outcome of the trial could set the stage for who will dominate the nation’s nascent autonomous-car industry.

U.S. District Judge William Alsup focused the 3.5-hour hearing on two interrelated motions by Uber to exclude trial evidence involving Morrison & Foerster, one of the law firms representing it in the trade-secrets case.

The first request sought to keep the jury from seeing an April 2016 indemnification agreement involving Anthony Levandowski, the beleaguered autonomous car engineer at the center of the case. Uber agreed to indemnify Levandowski and his driverless car company Otto on potential trade secret misappropriation claims after it conducted a due-diligence review of them last year to decide whether to acquire Otto.

Waymo claims Uber learned during the review that Levandowski stole 14,000 confidential files related to its self-driving car technology before he resigned, and used them to develop technology for Otto. The company claims Uber then purchased Otto to fast-track its own driverless-car program.

Waymo did not name Levandowski as a defendant in its February suit.

Morrison & Foerster advised Uber during the due-diligence review, and purportedly had access to the stolen files.

But Waymo wants to show the jury the indemnification agreement, along with a February 2016 email discussing indemnifying Levandowski and Otto for “bad acts,” including downloading Waymo’s files. It says the evidence can help it prove Uber knew about the theft early on, which Alsup has called a key issue in the case.

Uber attorney Hamish Hume, however, told Alsup on Wednesday that the indemnification agreement doesn’t prove that Uber knew about the theft – adding it would only confuse the jury.

“I thought about that, and Uber should’ve thought about that when Uber got itself into this mess,” Alsup retorted, referring to how the agreement might look to a jury.

“Now that you’re in that mess you want me to save you from it because it’s hard to explain it away,” he added before ruling the jury would see the agreement.

The battle over trial evidence is the latest salvo between the two Silicon Valley giants as they vie to be the first to bring self-driving cars to market. Analysts predict that autonomous cars will eventually replace driver-operated ones completely, and that companies late in developing the technology will flounder.

Uber’s second request sought to exclude reference at trial to Morrison & Foerster’s role in the Otto acquisition. Uber says the law firm’s role is irrelevant, and that it doesn’t plan to call anyone from the firm as a witness. Waymo, however, asked Alsup in a brief disqualify the firm as trial counsel.

Alsup compromised, tentatively ruling that attorneys for all parties must introduce themselves to the jury by first and last name only, and not identify their firms, noting that “MoFo [Morrison & Foerster] is an actor in the case and we can’t tell the story to the jury and somehow call it Law Firm X.”

He continued, “So my thought is not to disqualify anybody, but no-holds-barred when it comes to putting out the facts of the case.”

Next, Alsup addressed Waymo’s request to argue that Uber can be found guilty of trade secret theft based on the fact that Morrison & Foerster had access to its trade secrets during the due-diligence review.

Normally, a principal like Uber would be charged with knowledge of anything that an agent like Morrison & Foerster knew, unless the agent was obligated not to disclose the information to the principal, according to Alsup. But despite Uber attorney Karen Dunn’s assertion that Uber has produced evidence that Morrison & Foerster was contractually obligated not to disclose the information, Alsup wavered, saying he was considering throwing the question to the jury.

“Why is this for me? Why isn’t this for the jury to decide whether there was a contractual obligation?” he asked.

Uber also moved Wednesday to exclude evidence that other former Waymo employees who joined Uber stole Waymo’s files.  

Although Waymo had previously mentioned its former employees Sameer Kshirsagar and Radu Raduta as potential culprits, it told Alsup last month that it didn’t plan on pressing trade secret claims involving them because the information they allegedly took wasn’t in fact a trade secret.

Uber contends Waymo can’t re-launch its allegations involving Kshirsagar and Raduta, or levy claims against other former employees not named in its first amended complaint.

Waymo, however, says it has obtained new evidence since filing its complaint that Uber used Waymo’s trade secrets in its devices, including deposition testimony by an engineer who acknowledged using his “experience in the past at Google” to design them.

Alsup appeared to side with Waymo, calling Uber’s position “way off base.”

“What you want to do is impose a layer of proof that makes it even harder and harder, everything has to come through Levandowski in order for the jury to hear it. I don’t see that, I think it’s fair game, it’s enough to say, ‘This was a trade secret that came from Waymo and you’re using it,'” Alsup said.

“Plus he’s taken the Fifth,” the judge continued, referring to Levandowski invoking his Fifth Amendment right not to turn over evidence or testify at his deposition. “It may put you in a slightly awkward position, but I’m not too sympathetic. You knew what you were getting into with Levandowski.”

Nonetheless, Alsup ordered Waymo to file an offer of proof showing which Uber employees used its trade secrets, so he could determine whether it would be unfair to allow Waymo to expand its claims beyond Levandowski.

Finally, Alsup addressed Uber’s request to exclude adverse inferences against it based on Levandowski’s assertion of his Fifth Amendment rights, since he is no longer an Uber employee.

The company fired Levandowski in May for not cooperating with its internal investigation into Waymo’s allegations.

“The fact that he’s going to take the Fifth to any question I would ask him demonstrates that this is not an appropriate circumstance under which an adverse inference should be given against Uber,” Uber attorney Dunn said, signaling the company’s dissatisfaction with Lenvandowski’s conduct in the case.

Alsup tentatively ruled that he would allow Waymo to examine Levandowski at trial, on the condition that each question Waymo plans to ask be vetted by him first. He also said he would tell the jury members they can draw adverse inferences against Levandowski, but cautioned that he had still to decide whether those inferences would extend to Uber.

Trial is set for Oct. 10.

Hume and Dunn are with Boies Schiller Flexner in Washington. Uber is also represented by Arturo Gonzalez with Morrison & Foerster in San Francisco.

Waymo is represented by Charles Verhoeven and Jordan Jaffe with Quinn Emanuel Urquhart & Sullivan, also in San Francisco.

 

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