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Waymo v. Uber brawl sees 'suspicious' acts, 'pilfered files'

A judge rules Uber's self-driving car program safe for now, but also says its star engineer must step aside. All this and we haven't even gotten to trial.

Now playing: Watch this: Waymo gets its way in Uber lawsuit (sort of)

One thing is clear in the Waymo vs. Uber lawsuit: It's complicated.

Federal Judge William Alsup kinda, sorta sided with Uber when he ruled Monday not to shutter the company's self-driving car program. But in almost the same breath, Alsup kinda, sorta sided with Waymo by agreeing that something "highly suspicious" happened with Uber's star engineer Anthony Levandowski.

But let's back up. How did we get here?

In February, Waymo, the self-driving car unit of Google's parent company, Alphabet, filed a lawsuit against Uber alleging trade secret theft. Levandowski is at the center of the suit, with Waymo accusing him of stealing 14,000 "highly confidential" files on self-driving car technology in December 2015.

Levandowski used to work at Google but quit in January 2016 to form his own self-driving truck startup, called Otto. Uber bought Otto last August for $680 million and named Levandowski head of its self-driving car program.

Before Levandowski quit Google, he helped pioneer the company's autonomous vehicle program and develop its lidar technology, a key component in self-driving cars that lets vehicles "see" their surroundings and detect traffic, pedestrians, bicyclists and other obstacles.

It's that lidar tech that's at the crux of the Waymo v. Uber lawsuit.

Waymo claims Uber colluded with Levandowski to steal its lidar designs. Those designs, Waymo argues, have benefited Uber's driverless car tech.

Uber argues that its lidar technology is "fundamentally different" from Waymo's.

Self-driving cars are a hot topic in the auto and tech industries. Automakers from Toyota to Ford to Volvo all have projects under way. Besides Google and Uber, other Silicon Valley giants, including Apple, Intel and Tesla Motors, are betting on the tech. These vehicles aren't making money yet, but that could soon change. Once thought of as far-off future tech, driverless vehicles could be cruising city streets within the next 10 years, transforming the multitrillion-dollar auto industry.

Google started working on self-driving cars in 2009 and has now test-driven its vehicles nearly 3 million miles. Uber launched its self-driving project in 2015 and has since rolled out autonomous vehicles on city streets in Pennsylvania, California and Arizona.

What does the judge say?

Alsup said Uber can keep its project alive in the three states where it's operating, but that it must formally remove Levandowski as the head of the program. Uber also has to create a timeline of events regarding Levandowski being hired and "do whatever it can to ensure that its employees return 14,000-plus pilfered files to their rightful owner."

In anticipation of the judge's ruling, Levandowski said last month he'd step aside as head of Uber's driverless car program and recuse himself from all lidar-related work. He remains at the company, however.

"We are pleased with the court's ruling that Uber can continue building and utilizing all of its self-driving technology, including our innovation around LiDAR," an Uber spokeswoman wrote in an email. "We look forward to moving toward trial and continuing to demonstrate that our technology has been built independently from the ground up."

Waymo didn't respond to requests for comment.

The Alphabet company had asked for a preliminary injunction, basically requesting that the judge shut down Uber's self-driving project. But that's easier said than done.

Waymo needed to prove two things: that it would suffer irreparable harm if the injunction wasn't granted and that Uber used the files Levandowski allegedly downloaded. While Waymo wasn't able to get over the bar on those two points, the evidence the company has brought forward so far convinced Alsup that something shady probably happened.

"Waymo has made a strong showing that Levandowski absconded with over 14,000 files from Waymo, evidently to have them available to consult on behalf of Otto and Uber," Alsup wrote in his order on Monday. "Uber knew or at least should have known of the downloading but nevertheless proceeded to bring Levandowski and Otto on board."

Alsup referred the case to federal prosecutors last week for a possible criminal investigation into the alleged theft of trade secrets. The Department of Justice has already opened an inquiry into Uber on its secretive "Greyball" software tool.

If the DOJ decides to take the trade secrets case, prosecutors will likely look into Uber as a whole, said Phil Bezanson, attorney for the firm Bracewell. In its investigations, the agency tends to stress things like corporate culture, tone at the top and being a good corporate citizen, he said.

"Do we just have two disconnected data points from Greyball to Levandowski's actions?" Bezanson said the government will be asking. "Or is this a larger corporate culture problem?"

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