Uber and Waymo are finally going to trial. Why we should care

JP Mangalindan
Chief Tech Correspondent

After months of scandal and delay, the biggest trial in Uber’s history, both figuratively and literally, finally kicks off on Monday.

The judge and jury in a San Francisco federal court will seek to determine whether former Google engineer Anthony Levandowski stole trade secrets from Waymo, a self-driving car technology spun out from Google (GOOG, GOOGL). In particular, Waymo alleges Levandowski downloaded 14,000 confidential files in late 2015 related to Google’s self-driving car technology before leaving the company to co-found Otto, a startup that developed self-driving technology for truck rigs. In August 2016, Uber acquired Otto for a report $680 million and placed Levandowski in charge of Uber’s self-driving efforts. 

Waymo, for its part, claims the documents Levandowski downloaded were used to help develop Uber’s own self-driving car technology and misappropriates its trade secrets, particularly those related to Google’s distance-measuring LiDAR technology. Uber, however, denies any wrongdoing and has distanced itself from Levandowski. The company fired Levandowski in May 2017 for refusing to cooperate with the investigation. 

The Waymo vs. Uber trial was originally scheduled to start in October but saw multiple delays after U.S. District Judge William Alsup learned Uber withheld evidence in the form of a 37-page letter from a lawyer for a former Uber security analyst, which Uber did not share with Waymo as both sides prepared their cases.

“I can’t trust anything you say because it’s been proven wrong so many times,” Alsup told Uber during his heated remarks at a pre-trial hearing in November. “You’re just making the impression that this is a total cover-up.”

Once the trial kicks off, the list of witnesses reads like a partial who’s who of Silicon Valley talent, including Google co-founders Larry Page and Sergey Brin, former Uber CEO Travis Kalanick, former head of legal at Uber Salle Yoo, and Levandowski himself.

Uber has a lot at stake with Waymo vs. Uber, which finally goes to trial on Monday.
Uber has a lot at stake with Waymo vs. Uber, which finally goes to trial on Monday.

If Waymo winsFor Uber, there’s a lot at stake, beyond simply further damage to its already-tarnished reputation. In 2017, Uber was rocked by scandal, including Kalanick’s resignation as CEO following months of controversy around alleged sexual harassment at the company. Uber also made headlines again in November when a Bloomberg report revealed the company paid $100,000 in hush money to hackers, who had stolen the personal data (names, email addresses and phone numbers) of 50 million customers and 7 million drivers, including nearly 600,000 U.S. driver’s license numbers.

If Waymo wins, Uber could face damages that eclipse the $680 million it originally paid to acquire Otto, the company Levandowski co-founded. A verdict in Waymo’s favor could also deal a big blow to the research and development of Uber’s self-driving cars, which are already deployed in Pittsburgh. Depending on the outcome, a win for Waymo could mean the end of Uber’s push into the self-driving business.

The Waymo vs. Uber suit could also have lasting effects on Silicon Valley as a whole, bringing hiring practices into question. In tech, talented engineers come and go, with many companies — big and small — poaching from one another, based on their work and accomplishments, often having to do with top-secret projects. What constitutes a breach in confidentiality, and how do those employees compartmentalize the knowledge they accrue at one employer when they move onto the next?

Many such questions will perhaps be answered after the trial. 

JP Mangalindan is the Chief Tech Correspondent for Yahoo Finance covering the intersection of tech and business. Email story tips and musings to jpm@oath.com. Follow him on Twitter or Facebook.

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