Waymo, Uber dispute referred to US attorney for investigation

The judge also disallowed Uber’s petition to try to resolve the issue through arbitration

A lawsuit by Waymo, alleging the use by rival Uber Technologies of stolen trade secrets relating to autonomous vehicle technology, has been referred by a federal judge to a U.S. attorney, raising the possibility of a criminal prosecution.

“This case is referred to the United States Attorney for investigation of possible theft of trade secrets based on the evidentiary record supplied thus far concerning plaintiff Waymo LLC’s claims for trade secret misappropriation,” wrote Judge William Alsup of the U.S. District Court for the Northern District of California late Thursday.

“The Court takes no position on whether a prosecution is or is not warranted, a decision entirely up to the United States Attorney,” Judge Alsup added.

In another order, the Judge also rejected Uber’s motion that most of the claims of the lawsuit should be settled through arbitration, a process that is usually conducted in private, and is cheaper and faster than a federal lawsuit.

The dispute in the autonomous vehicle technology market reflects the stiff competition to get driverless vehicles in the hands of consumers. Besides Waymo and Uber, a number of other tech companies and traditional car makers are targeting the new opportunity.

Waymo filed a suit in February in the California court, alleging that a former employee Anthony Levandowski stole trade secrets relating to self-driving cars before leaving to start Otto, a self-driving trucking company that was later acquired by Uber. Other former Waymo employees who left for Uber and Otto were also found downloading sensitive files, Waymo claimed.

Waymo has also charged Uber of of infringing on two of its patents.

The Alphabet unit has alleged in its complaint that Uber got a head start by pilfering its technology, and built its own comparable LiDAR system within nine months. Before he quit, Levandowski led a team of Waymo engineers who developed LiDAR technology for its self-driving car project, according to court documents.

Uber has said in court that it never possessed and used any information Levandowski allegedly took from Waymo.

Levandowski is not a defendant in the lawsuit, but he had asserted his Fifth Amendment right against self-incrimination and refused to turn over documents relating to the case. He has since moved out of his position at Uber, heading the self-driving group, though he remains with the company.

The ride-hailing company had referred to Waymo’s own arbitration proceedings against Levandowski as the basis for its argument in favor of arbitration. “Waymo’s trade secret and unfair competition claims must be referred to arbitration because they arise out of, relate to, and result from Levandowski’s employment,” Uber had submitted in a filing. The employment agreements Waymo signed with Levandowski require arbitration of all disputes “with anyone” that arise out of, relate to, or result from Levandowski’s employment, it added.

Uber seeks “to steer this case into arbitration even though they have no agreement with anyone to arbitrate the case,” Judge Alsup wrote while denying Uber’s motion to compel arbitration.

“It is unfortunate that Waymo will be permitted to avoid abiding by the arbitration promise it requires its employees to make. We remain confident in our case and welcome the chance to talk about our independently developed technology in any forum," Uber said in a statement.

The company said it will not be commenting on the referral to the U.S. Attorney’s office.

Waymo said the motion was “a desperate bid by Uber to avoid the court's jurisdiction." The company said it welcomed the court's decision and looked forward “to holding Uber responsible in court for its misconduct."

A decision on a plea for an injunction on Uber’s alleged use of Waymo’s trade secrets is under seal. Court records show that it was granted "in part."

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