Uber Strikes a Deal with Waymo in Trade Secret Trial

Posted by at 10:02 am on February 9, 2018

Alphabet’s Waymo and Uber have agreed to bury the hatchet and settle a lawsuit revolving the latter’s self-driving vehicle aspirations. As a result, Uber will pay Alphabet a hefty sum (in the eyes of mere mortals): $244 million. But in the grand scheme of things, it’s still a relatively small figure for Uber, which has value of $72 billion.

Waymo alleged that Anthony Levandowski, who headed up Waymo/Google’s self-driving car division, took confidential intellectual property (roughly 10GB of data files that were downloaded from corporate servers) with him when he left in early 2016 to start Otto. Otto was a self-driving truck company that would end up being purchased by Uber. Alphabet’s thinking is that Otto, and more importantly Levandowski, was a huge “get” for Uber thanks to the Waymo/Google IP that Levandowski was able to obtain.

Uber is then alleged to have used that technology to help jumpstart its efforts in self-driving vehicles, which could someday replace its scores of human drivers.

“While I cannot erase the past, I can commit, on behalf of every Uber employee, that we will learn from it, and it will inform our actions going forward,” Khosrowshahi wrote. “As we change the way we operate and put integrity at the core of every decision we make, we look forward to the great race to build the future.”

Waymo said in a statement that, according to the terms of the settlement, it would receive 0.34% of Uber’s equity at an earlier valuation high of $72 billion, which is about $245 million. Japanese investment firm SoftBank and a variety of partners recently took a large stake in Uber but at a new valuation closer to $50 billion.

Uber CEO Dara Khosrowshahi took a conciliatory tone when announcing the settlement, writing,

“To our friends at Alphabet: we are partners, you are an important investor in Uber, and we share a deep belief in the power of technology to change people’s lives for the better. Of course, we are also competitors.”

“And while we won’t agree on everything going forward, we agree that Uber’s acquisition of Otto could and should have been handled differently.”

Khosrowshahi goes on to add that while he doesn’t believe that Waymo’s trade secrets were used in the development of Uber’s autonomous vehicle program, the company is “taking steps with Waymo to ensure our Lidar and software represents just our good work.”

Waymo was all business, writing in a statement:

“We are committed to working with Uber to make sure that each company develops its own technology. This includes an agreement to ensure that any Waymo confidential information is not being incorporated in Uber Advanced Technologies Group hardware and software.

“We have always believed competition should be fueled by innovation in the labs and on the roads and we look forward to bringing fully self-driving cars to the world.”

 

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