Takeaways from the Swift End to <i>Waymo v. Uber</i>

“It was definitely the trade secret trial of the century,” said Robert Milligan, Los Angeles-based co-chair of Seyfarth Shaw's trade secrets, computer fraud and noncompetes practice group, who was watching the Waymo v. Uber trial from afar. “Just for the prurient interest I'm sad to see it go away,” he added.

Milligan was far from alone among lawyers in the labor and employment and intellectual property bars in the wake of the announcement on Feb. 9 that the parties had reached an agreement to settle the case in U.S. District Judge William Alsup of the Northern District of California's courtroom. The underlying dispute centered on Uber's acquisition of Ottomotto, an autonomous car company founded by former Google engineer Anthony Levandowski. At trial, Waymo's lawyers from Quinn Emanuel presented evidence that Levandowski had downloaded a trove of 14,000-plus files from Google before he left to form the startup and that he had copied the files to his personal laptop.

As part of the deal, Waymo received a 0.34% equity stake in Uber Technologies Inc., or about $245 million based on a $72 billion valuation of the ride-sharing giant. Perhaps more valuably, Waymo got assurances that Uber will not incorporate any of Waymo's confidential information into its hardware and software. Now that the case itself is, as Alsup said after the settlement announcement, “ancient history,” here are three things for lawyers to take away from the whole saga.

Trade Secrets Are the New Black

The details might not be quite as dramatic as they were in Waymo v. Uber, but lawyers expect trade secrets to continue to be a fertile source for litigation.

Milligan said that in regard to high-level employees, the lesson for employers is simple: “You have to read them the riot act as far as not bringing over any of their former employer's data.” Milligan said that goes double for high-level engineers, who tend to have an “ownership psyche” and may regard know-how that they carry in their brains as fair game, even when it's likely to be trade secret-worthy.

“Typically that know-how belongs to the former employer rightly or wrongly. That's where you have to be even more careful — particularly where there are strong personalities and strong emotions involved,” Milligan said.

Digital Fingerprints Are Everywhere

The digital age has made it easier than ever for an employee to walk out the door with massive amounts of data, as former Google engineer Anthony Levandowski is alleged to have done with the company files related to driver-less car technology. Even though Levandowski stayed mum, asserting his Fifth Amendment right not to incriminate himself in the case, the digital breadcrumbs left in his hardware allowed Waymo's lawyers at Quinn Emanuel Urquhart & Sullivan to lay out a compelling case.

“Everything has a digital footprint,” said Santa Monica-based employment lawyer Daniel Handman of Hirschfeld Kraemer. “[Technology companies] know when their things have been taken, accessed, stolen better than anyone else.”

Jason Geller, a management-side employment lawyer at Fisher & Phillips in San Francisco, said that even with the modern ways of tracking company data, it's important for companies to take stock of exiting employees through thorough interviews. He said it's also a good practice to get written representations from departing employees that they aren't taking any company data or trade secrets with them.

What Becomes of Anthony Levandowski?

We'll have to wait and see.

His lawyers at Ramsey & Ehrlich didn't respond to an email seeking comment.

But since Alsup referred the case to the U.S. Attorney's Office last year, Levandowski has lost his job and, according to testimony from his Otto co-founder at trial, the driver-less car company he left behind at Uber has missed out on all kinds of milestone-based payouts.

The U.S. Attorney's Office acknowledged that its criminal investigation was ongoing earlier this year in a letter to Alsup. Just if and when federal prosecutors might move to press charges against Levandowski is unclear.

Since Waymo v. Uber didn't make it to the jury, no trier of fact has determined that the trade secrets Levandowski is alleged to have taken were actually protectable. But Seyfarth's Milligan points out prosecutors did get the benefit of seeing the evidence that came in at the civil trial and will be able to rely on the assessments of some of the experts for both sides in the case before they take action.

***** Ross Todd is bureau chief of The Recorder, a San Francisco-based ALM sibling of The Intellectual Property Strategist.