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Judge Alsup Delays Uber-Waymo Trial Due To Prospect Of A ‘Cover-Up’

Posted by Seth Chazin | Dec 04, 2017 | 0 Comments

Intellectual property
CC BY-SA 3.0 Nick Youngson

On Tuesday, November 28th, 2017, Judge William Alsup delayed the Uber-Waymo trial to allow Waymo time to review a letter that alleges that Uber trained some employees to steal trade secrets.

Waymo has accused Uber of stealing confidential information regarding their self driving cars and designs. The multibillion dollar case began in February, and is considered to be the highest stakes legal challenge that Uber chief executive, Dara Khosrowshahi, inherited when he took the position in August.

Yesterday's hearing focused on a letter from the lawyer for Richard Jacobs, a former Uber security analyst, which Uber lawyers failed to share with Waymo lawyers as part of discovery. The U.S. Department of Justice told U.S. District Judge Alsup about the letter just days before the trial was to begin. Alsup issued an order to compel Jacobs to appear in court. Judge Alsup has previously referred this case to the United States Attorney's Office in San Francisco for the consideration of possible criminal charges, presumably charges such as Theft of Trade Secrets, Wire Fraud, and other related charges.

Uber was asked to gather any relevant documents months ago in preparation for the case, and their negligence in sharing this letter annoyed the Judge. He told Uber, “ I can't trust anything you say because it's been proven wrong so many times. You're just making the impression that this is a total cover-up.”

Alsup agreed to delay the jury trial, saying that “if even half of what this letter says is true it would be a huge injustice to force Waymo to go to trial.”  This is the second time the trial has been delayed, as it was previously delayed in October.

Jacobs left Uber in April, but works for them as a consultant. He testified regarding the contents of the letter. The letter stated that marketplace analytics, or MA, is an organization within Uber which acquires “trade secrets, code base, and competitive intelligence.” Jacobs also described how Uber researched competitors, and used technology to avoid a paper trail. Employees were trained to “impede, obstruct, or influence any lawsuit against Uber”. This includes a communication strategy which did not create a paper trail.

The company used messaging apps, such as Wickr, and other methods of communication that could not be traced back to the user. Some employees had access to separate servers from the rest of the company.

Jacobs stated that his knowledge of this came through discussions with his manager and other colleagues. He did disagree with the charge  that Uber had stolen any information from Waymo.

An Uber spokeswoman said, “None of the testimony today changes the merits of the case.”

The case began in February when Waymo sued Uber, estimating $1.9 billion in damages, and wants Uber to end their self driving car program. Waymo alleges that Uber is using Waymo secrets and technology, and that former executive, Anthony Levandowski, downloaded more than 14,000 confidential files before leaving the company to start self-driving truck company, Otto. Uber acquired Otto soon after the company was set up.

Uber denies using any Waymo secrets, while Levandowski has not answered any questions on the allegations citing his constitutional Fifth Amendment right to not incriminate himself. Levandowski is no longer employed by Uber.

There is no new trial date set, but the hearing will continue on Wednesday, the 29th of November. Uber's in-house lawyer, Angela Padilla, is set to testify. Padilla is said to have received a letter from Jacobs last May detailing his concerns about Uber's behavior. Waymo believes that Uber concealed this letter.

Jacobs said he believes that he was fired from Uber because of his objections to their practices. He received a $4.5 million settlement after his termination. Uber's attorneys said that Jacobs' letter was simply an ex-employee seeking more money.

This case is one of many scandals that have been plaguing Uber recently. Last week it emerged that the data of 600,000 drivers and 57 million Uber customers had been stolen more than a year ago. Uber paid two hackers to cover up the breach. Governments around the world are investigating the incident. The Illinois Cook County prosecutor, and Washington State Attorney Bob Ferguson have filed cases against the company for failing to comply with data breach notification laws.

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About the Author

Seth Chazin

Seth P. Chazin has aggressively defended clients in thousands of felony and misdemeanor cases for over 25 years. He has extensive experience representing criminal defendants in federal and state court, while handling both state and federal appeals as well.

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Seth P. Chazin is a San Francisco Bay Area Criminal Defense Lawyer with over 25 years experience.

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