On February 23, 2017, Waymo (a subsidiary of Google’s parent company, Alphabet) filed a lawsuit against Uber, claiming that Uber stole technology integral to the development of self-driving cars. This only adds to what has been a disastrous 2017 for Uber in the news. Earlier this year, negative publicity from Uber’s response to a taxi driver strike in NYC led to the #DeleteUber campaign, and rocked the ride-sharing company. The strike was in response to President Trump’s immigration ban and many customers were upset when Uber kept prices low, seemingly attempting to capture the business generated by the strike. Some were equally displeased with Uber CEO Travis Kalanick’s choice to participate on President Trump’s economic advisory council. The political pressure became so great so quickly that Kalanick stepped down from the council.
The dust had hardly settled from the initial #DeleteUber campaign when it was fired up again in response to allegations of sexual harassment from inside the company. Susan Fowler, previously an Uber engineer, recently went public with information that she was sexually harassed by her manager. Fowler claimed that when she reported the incidents to HR and upper management, she was informed that her supervisor would not be disciplined. Fowler relates, “I was then told that I had to make a choice: (i) I could either go and find another team and then never have to interact with this man again, or (ii) I could stay on the team, but I would have to understand that he would most likely give me a poor performance review when review time came around, and there was nothing they could do about that.” Again, social media erupted and users rushed to delete their Uber apps. Uber responded to the public outcry by issuing an apology.
Most recently, Uber has found itself not only faced with bad publicity, but with a potentially crushing lawsuit. On February 23, 2017, Waymo filed a 28 page complaint against Uber in federal court in the Northern District of California. The complaint accuses Uber of several counts of patent infringement as well as violations of both the California Uniform Trade Secret Act and the Defend Trade Secrets Act. The DTSA “[f]or the first time . . . authorizes a federal private right of action to remedy trade secret misappropriation.” Passed in 2016, the DTSA is an amendment to the Economic Espionage Act of 1996.
The lawsuit revolves around lidar (Light Detection and Ranging) technology. “Lidar is a radar-like system that uses lasers instead of radio waves to build a 3-D image of the surrounding landscape.” The technology has a variety of uses, from speed measurement for law enforcement to large scale topographic mapping by the National Oceanic and Atmospheric Administration (NOAA). “Lidar specialists such as Velodyne Lidar Inc. say that, to cut the driver completely and permanently out of the equation, the technology is essential.”
Waymo claims that a previous Google employee, Anthony Levandowski “secretly downloaded 14,000 files from its hardware systems, resigned a month later, and then used the information to launch a self-driving truck startup called Otto.” Shortly thereafter, Uber acquired Otto and hired Levandowski to oversee the project.
Uber has been testing Otto’s self-driving trucks on the roads for months, potentially in violation of California law. Uber has refused to secure a permit that is required by the California DMV to test the vehicles on public roads. This would not be the first time that Uber has run afoul of state permitting procedures, as it was fined almost $11.4 million by the Pennsylvania Public Utility Commission for operating its ride-sharing program without agency approval in 2014.
Waymo claims that Otto’s lidar technology is simply too similar to that which Waymo has been developing for years and that “before it acquired Otto, Uber was ‘more than five years behind’ in the race to develop reliable autonomous vehicles . . . .” Waymo alleges that “Levandowski’s actions were ‘part of a concerted plan to steal Waymo’s trade secrets and intellectual property,’” and that “Months before the mass download of files, Mr. Levandowski told colleagues that he had plans to ‘replicate’ Waymo’s technology at a competitor.”
Thus far, Uber has denied the allegations, calling the suit “a ‘baseless’ ploy to hinder the progress of a competitor.” However, the suit is getting plenty of media attention and is only adding to Uber’s recent barrage of negative press. As phrased by Alex Davies of Wired,
“If the suit goes to trial, Apple’s legal battle with Samsung could wind up looking tame by comparison.”