Judge postpones Uber trade secret trial based on bombshell memo

A memo details how the company allegedly used vanishing messages and other tricks to steal Waymo's secrets regarding self-driving cars.

Marguerite Reardon Former senior reporter
Marguerite Reardon started as a CNET News reporter in 2004, covering cellphone services, broadband, citywide Wi-Fi, the Net neutrality debate and the consolidation of the phone companies.
Marguerite Reardon
4 min read

A federal court judge in California delayed the start of a civil trial between ride-hailing giant Uber and Waymo, Alphabet's self-driving car unit, after receiving a memo written by the attorney of a former Uber employee about the alleged theft of trade secrets. 

Judge William Alsup said during a hearing Tuesday that he'd only just received the letter, which a former Uber security analyst sent to one of the company's lawyers. The full content of the letter hasn't been shared publicly, but parts of it were read aloud during the hearing. 

The 37-page letter, written earlier this year by Ric Jacobs' attorney, details tactics Uber allegedly used to obtain trade secrets and destroy evidence. The letter details allegations that Uber employees were trained to "impede" ongoing investigations by using messages that vanished and couldn't be traced to the company. Uber fired Jacobs in April.

"These tactics were employed clandestinely through a distributed architecture of anonymous servers, telecommunications architecture, and non-attributable hardware and software," the letter says, according to transcripts from Tuesday's hearing. 

The memo also alleges Uber employees educated the company's autonomous vehicle team in Pittsburgh "on using ephemeral communications, non-attributable devices, and false attorney-client privilege designations with the specific intent of preventing the discovery of devices, documents, and communications in anticipated litigation." 

Uber CEO Dara Khosrowshahi addressed these allegations on Twitter on Wednesday, saying disappearing chat apps like "Wickr, Telegram were used often at Uber when I came in. As of Sept 27th I directed my teams NOT to use such Apps when discussing Uber-related business." 

Watch this: AutoComplete: Uber buys 24,000 Volvos for self-driving program

Waymo asked the court on Monday to postpone the start of the trial, which was set to begin next week, saying Uber had concealed the letter and it needed more time to review it. Alsup agreed to grant the delay during the Tuesday hearing.

"We're going to have to put the trial off, because if it is true -- if even half of what's in that letter is true, it would be a huge injustice to force Waymo to go to trial and not be able to prove the things that are said in that letter," Alsup said. 

During another hearing Wednesday, a new trial date was set for Feb. 5.

For its part, Uber says the merits of the case haven't changed. "Jacobs himself said on the stand today (Tuesday) that he was not aware of any Waymo trade secrets being stolen," an Uber spokeswoman said in a statement to CNET. 

The company also reiterated that it is eager to begin the trial.   

"Uber has been waiting for its day in court for quite some time now," the spokeswoman said. "We're keen to have a jury finally hear this case on its merits."   

Waymo sued Uber in February, accusing the company of stealing secretive self-driving car technology. The case centers around former Google employee Anthony Levandowski, who allegedly stole 14,000 "highly confidential" files before leaving the company to start his own self-driving truck startup. Uber bought that startup several months later for $680 million and tapped Levandowski to head of its autonomous vehicle program.

Levandowski has since been fired by Uber. But Waymo says that doesn't dismiss the possibility that the ride-hailing company still used the secrets in the allegedly pilfered files for its own self-driving car tech.

"Today's revelations fit Uber's pattern of destroying and withholding reams of evidence relevant to our trade secrets case, and [show] that those at the very top of Uber were aware of these inexcusable practices," a Waymo spokeswoman said in a statement to CNET. "We look forward to the additional discovery granted by the Court and to presenting our case in front of a jury at trial."

Federal prosecutors from the Department of Justice are also looking at whether the trade secrets in question were taken illegally. So far, no charges have been filed.

Uber has been rocked by scandals over the past year, including several sexual harassment claims. In a scandal that broke last week, the company tried to cover up a 2016 data breach involving millions of its customers and drivers. 

CNET's Dara Kerr contributed to this report.

First published Nov. 28, 10:45 a.m. PT.
Updates, Nov. 29 at 10:24 a.m. PT: Adds statements from Uber; 4:08 p.m.: Adds the new trial date and information from the Jacobs letter; Nov. 30 at 10:02 a.m. PT: Adds statement from Waymo.

Correction, Nov. 29 at 4:43 p.m. PT: The letter was written by Jacobs' attorney.

Batteries Not Included: The CNET team reminds us why tech is cool.

CNET en Español: Get all your tech news and reviews in Spanish.