By: Ilya Mirov,

In Silicon Valley, losing or gaining an employee can lead to a litany of legal issues. It is common practice for former employers to warn new employers against working on projects related to trade secrets that the transitioned employee might be able to reveal. [1] If this employee begins to work for another firm in a similar field, he may be precluded from disclosing trade secret material from his previous employer. [2] Next month, an interesting case of this kind will be tried—Waymo v. Uber.

This case began with the typical vestiges of Silicon Valley employee transitions—stern letters mailed to the new employer and reminders to the employee of his or her duty not to disclose trade secret information. [3] But instead of ending there or settling out of court, this case is going all the way to trial to be decided by the federal circuit in October of this year. [4] The dispute began in 2016 after Waymo’s former self-driving car engineer, Anthony Levandowski, formed his own self-driving truck technology company (Otto Trucking) and began to work for Uber. [5] Waymo’s evidence includes records of an unusually high volume of confidential file downloads from Levondowski’s computer before he left. [6]

Waymo highlights the security that it employed in protecting its trade secret: “All networks hosting Waymo’s confidential and proprietary information [are] encrypted and [require] passwords and dual-authentication for access,” reads the original complaint. “Computers, tablets, and cell phones… are encrypted, password protected, and subject to other security measures. And Waymo secures its physical facilities by restricting access and then monitoring actual access with security cameras and guards.” [7]

But what effect would it have on the case if Waymo also gave away its secret lidar circuit boards to a going-away employee? As revealed in a recent court filing, Waymo turned its previous-model lidar circuit board, the Grizzly Bear 2 (GBr2), into a pair of earrings gifted to Seval Oz, head of Global Partnerships and Business Development for Google’s self-driving car program from 2011 to 2014. [8] She received the earrings when she left the company in the summer of 2014 to run Continental’s Intelligent Transportation System division. [9]

Pierre-Yves Droz, a Waymo engineer on the self-driving team, revealed the nature of the earrings in a deposition given earlier this month. When handed the earrings and asked if he recognized them, Droz identified them as the Grizzly Bear 2 boards. [10] The Grizzly Bear 3, only a minor improvement over the Grizzly Bear 2, provided the basis for the lawsuit. [11] “This is confidential… [It’s] not something we should give to someone, especially if someone is leaving the company,” he said. [12]

It is likely that that Uber will make the argument that Waymo has lost its trade secret protection for its lidar technology through the distribution of these high-tech earrings. [13] Anthony Levandowski exchanged multiple text messages with Oz in an effort to obtain the earrings over the course of several weeks in July and August as was revealed within the filing. [14]

The case is due to go to trial on October 10 and will be an interesting data point to track in trade secret law.

 

 

[1] Derek Handova, Waymo v. Uber: A Gordian Knot Gets Tighter, IPWatchdog, June 15, 2017, http://www.ipwatchdog.com/2017/06/15/waymo-v-uber-gordian-knot-gets-tighter/id=84511/

[2] Id.

[3]Mark Harris, Could a Pair of Earrings Hurt Waymo’s Lidar Trade Secrets Lawsuit?, IEEE Spectrum, Sept. 11, 2017, https://spectrum.ieee.org/cars-that-think/transportation/self-driving/could-a-pair-of-earrings-hurt-waymos-lidar-trade-secrets-lawsuit

[4] Waymo LLC v. Uber Techs., Inc., No. 2017-2130, 2017 U.S. App. LEXIS 17665 (Fed. Cir. Sep. 13, 2017)

[5] Id.

[6] Id.

[7] Mark Harris, Could a Pair of Earrings Hurt Waymo’s Lidar Trade Secrets Lawsuit?, IEEE Spectrum, Sept. 11, 2017, https://spectrum.ieee.org/cars-that-think/transportation/self-driving/could-a-pair-of-earrings-hurt-waymos-lidar-trade-secrets-lawsuit

[8] Id.

[9] Id.

[10] Id.

[11] Id.

[12] Id.

[13] Id.

[14] Id.

Image Source: https://techcrunch.com/2017/06/07/uber-waymo-lawsuit-stay-denied/.