Remember Jawbone? The Fitbit rival, which went out of business last year, claimed repeatedly that Fitbit had stolen its trade secrets. Now Jawbone is about to get its day in court, again.
One current and five former Fitbit employees have been indicted in US District Court with possessing Jawbone trade secrets. The indictment was issued Thursday in the Northern District of California in San Jose. The defendants worked for Jawbone between 2011 and 2015, according to the indictment, and all accepted job offers from Fitbit during or right after their employment with Jawbone. If convicted, they will be fined and face up to 10 years of imprisonment.
Jawbone filed three lawsuits in 2015 claiming that Fitbit lured away employees specifically to steal trade secrets and learn about its supply chain and financial data. In October 2015, a San Francisco judge ordered five Fitbit employees to return confidential information they took before leaving Jawbone.
Thursday's indictment alleges the six employees took a variety of confidential documents, such as "schematics, design specifications and detailed description" of an unreleased headphone, emails and design documents related to different headphones, financial profit and loss forecasts and an in-depth, proprietary study of more than 1,400 Jawbone users.
The defendants received these documents "knowing them to have been stolen and appropriated, obtained, and converted without authorization ... for the economic benefit of someone other than Jawbone," according to the indictment.
The two companies had waged multiple legal battles over the years, including a case before the International Trade Commission against many of the same Fitbit employees. In that case, "a federal administrative law judge during a nine-day trial on the merits found that no Jawbone trade secrets were misappropriated or used in any Fitbit product, feature or technology," a Fitbit spokesman said in an email statement.
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