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Uber and Waymo are finally going to trial in an epic war over self-driving tech that could reshape Silicon Valley

Uber stands accused of stealing highly sensitive trade secrets from the Google-linked autonomous-vehicle startup. Here's what you need to know.

  • On Monday, Uber and Waymo will go to court over allegations that Uber stole trade secrets relating to self-driving-car technology.
  • The case hinges on Anthony Levandowski, a rock-star engineer who is accused of taking huge troves of information when he left Google and later joined Uber.
  • Google is seeking damages from Uber as well as a permanent injunction blocking it from using the tech.
  • The case could have broader implications for hiring in Silicon Valley.
  • Whatever happens, this isn't the end for Uber — but it could be a major setback.
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Uber and Waymo are finally about to have their day in court — and sparks are sure to fly.

On Monday, in what promises to be one of Silicon Valley's biggest legal battles in years, the trial officially begins to determine whether Uber stole trade secrets from Waymo, a self-driving-car unit owned by Google's parent company.

The buildup over the past year has produced explosive headlines about the accusations against Uber and has sparked debate about the appropriateness of the "move fast and break things" Silicon Valley ethos epitomized (though not coined) by the ride-hailing firm.

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The Hollywood-perfect storyline pitting two tech behemoths against each other and the drama and revelations leading up to the trial have created such a stir that William Alsup, the federal judge in San Francisco overseeing the case, has had to reiterate that this is still, at its heart, a dispute over intellectual property.

"The central issues in this case remains whether or not Uber misappropriated Uber's trade secrets, not whether Uber is an evil corporation," he said.

Whatever the ultimate outcome, it seems unlikely to prove fatal for Uber or even for its self-driving-vehicle ambitions. But when it comes to its reputation, the damage may have been already done.

And beyond the bitter conflict between Uber and Waymo, the case could have broader consequences for hiring in the tech industry's ultracompetitive, never-ending battle for talent.

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At the heart of the case is Anthony Levandowski, a rock-star engineer who worked on Google's self-driving-car efforts (the project that would later become Waymo) before jumping ship to start a self-driving-truck startup called Otto that Uber subsequently acquired.

He is accused of taking huge troves of confidential Google documents with him when he left — and Uber is accused of using that information as it raced to develop its own lidar technology, a sensor used in self-driving vehicles.

A law firm Uber retained to conduct due diligence before hiring Levandowski found that the engineer had been in possession of a large stash of Google documents. But he said he destroyed them, and Uber insists they never made their way to the company's servers.

Over the past year, the case has surfaced multiple details that paint Uber as a company in an unflattering light — most notably the bombshell "Jacobs letter" written by the lawyer of a former Uber employee. It alleged that a special team within Uber hacked into competitors' computer systems, stole data from rivals, recorded the private conversations of competitors at a hotel, and used self-destructing-messaging services.

The color and lurid details have sometimes obscured the substance of the dispute — prompting Alsup's "evil corporation" reminder. "Waymo's decision to devote so much time and effort to pursuing matters with so little connection to the merits [of the case] raises the possibility that Waymo is unwilling or unable to prove up a solid case ... and instead seeks to inflame the jury against Uber with a litany of supposed bad facts," he said.

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Uber fired Levandowski last year after he refused to cooperate with Uber's legal team. He is not a defendant in the case but will most likely be called as a witness, and he is expected to use his Fifth Amendment rights rather than answer questions.

Much in this case rests on exactly how a trade secret is defined. Broadly speaking, it is information with economic value that isn't known to the public or others who might obtain value from knowing it. This doesn't, however, extended to professional skills and abilities — and it can be tricky to draw the line.

"When [engineers] move to new jobs with new employers, they cannot be expected to erase such natural on-the-job practical lessons from memory and will remain free under law to use them," Alsup wrote in a draft of the instructions for jurors. "Engineers cannot, however, go further in new jobs with new employers to use or disclose to others specific engineering solutions or information developed by their prior employers."

Waymo argues that Levandowski purloined trade secrets and used them to advance Uber's lidar-building efforts, while Uber counters that it independently and properly developed all of its tech and that Waymo's "trade secrets" shouldn't even be considered trade secrets in the first place.

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California has historically been relaxed about the flow of talent between companies — refusing to enforce noncompete clauses in employment contracts that are intended to prevent people from working for competitors in the future. A particularly zealous approach in this case could leave engineers feeling limited in what they bring with them to new jobs and could open the door to future trade-secrets litigation around hiring.

"Any time you have a high-profile case like this ... involving contested trade secrets and the plaintiff wins I think it probably does ultimately have an impact," Elizabeth Rowe, a professor at the University of Florida Levin College of Law, told Business Insider. "I suspect if they win that yeah, it could ultimately cause people to pause and think twice."

Alsup has so far attempted to balance the competing demands of intellectual property and employee freedom, asking at a pretrial hearing in November: "Is an engineer supposed to get a frontal lobotomy before they go on to the next job? The answer's got to be no, but say they know the recipe for Coca-Cola. They have to forget that before their next job."

Waymo is seeking damages and a permanent injunction preventing Uber from using Waymo's self-described trade secrets. If it can convince the jury that its "trade secrets" are in fact trade secrets, it will be up to the jury to determine damages, but it will be Alsup who makes the decision on an injunction.

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The former Uber CEO Travis Kalanick has said the company's future depends on self-driving technology — but an injunction, while embarrassing, would not be catastrophic to the company. The autonomous vehicles it has in the field today don't use the disputed technology but instead rely on off-the-shelf tech from a third-party company, Velodyne.

The real cost to Uber — whatever the legal consequences — may be the massive reputational damage. Over the past year, Uber has been rocked by scandal after scandal, from allegations of workplace sex discrimination to bad behavior by executives, culminating in the ousting of Kalanick. Losing its fight with Waymo would be viewed by many as karmic retribution — a capstone to its sordid history.

"Uber has been playing defense throughout the litigation, both inside and outside the courtroom," Eric Goldman, a professor at the Santa Clara University School of Law, said in an email. "While it's made some progress cutting back Waymo's case, Uber hasn't yet shaken Waymo's core allegations, nor has Uber been able to quell the nagging suspicion that Uber did something wrong here — which would be consistent with its string of high-profile gaffes in other aspects of its business."

"Plus," Goldman added, "the litigation helped force Uber's key expert on self-driving vehicles, Levandowski, out of the company, making Uber's acquisition of his business very, very costly. "

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