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In Waymo v. Uber, honing the craft of litigation gamesmanship
March 29, 2017 / 7:05 PM / 5 months ago

In Waymo v. Uber, honing the craft of litigation gamesmanship

(Reuters) - You know a case is momentous when a seemingly routine proposed briefing schedule turns into a hot dispute. Waymo’s patent and trade secrets suit accusing Uber of hijacking its technology for driverless cars is only five weeks old, but lawyers for both sides are already deep in litigation chess games.

On Monday, Uber’s lawyers at Morrison & Foerster and Boies Schiller & Flexner filed a motion to compel arbitration of Waymo’s trade secrets and California unfair competition claims. The motion claimed Waymo’s lawyers at Quinn Emanuel Urquhart & Sullivan are trying to get away with a bit of litigation trickery.

According to Uber, the crux of Waymo’s case, filed in federal court in San Francisco, is that engineer Anthony Levandowski, who led Waymo’s self-driving tech team for years, downloaded more than 14,000 sensitive files before he left the company to start up his own self-driving venture, which was later acquired by Uber. Levandowski, Uber said, signed two different employment contracts during his nine-year stint at Google and Waymo, both of which are subsidiaries of Alphabet. The agreements contained provisions requiring the engineer to arbitrate disputes with the company. Uber’s lawyers argued that because Waymo is accusing Uber of benefiting from Levandowski’s supposed violation of his employment contract, Levandowski’s arbitration clause applies.

Uber’s brief cited cases to back its argument, which is based on the legal principle of equitable estoppel. In the closest parallel to the Waymo case, a federal judge in San Jose ordered the tech company Torbit to arbitrate its case against a fired software developer who allegedly misused Torbit trade secrets when he started his own company, Datanyze. Datanyze wasn’t subject to the employment agreement between Torbit and the developer, but the judge ruled the claims against the company were intertwined with allegations against the former employee.

But Waymo, unlike Torbit in the Datanyze case, did not name its former employee as a defendant. It sued only Uber, not Levandowski, the former Waymo engineer who supposedly misappropriated Waymo data and brought it to his new employers at Uber.

Uber’s motion called that elision a deliberate attempt to get around precedent requiring Waymo to go to arbitration. “Despite the myriad allegations about Levandowski’s serious misconduct while a Waymo employee, Waymo omits him as a named defendant,” Uber’s motion said. “Waymo’s purpose for proceeding in this curious manner seems clear: through artful pleading, it hopes to avoid arbitrating the misappropriation … claims at all costs.”

Waymo, meanwhile, contends there is something fishy about the timing of Uber’s motion to compel arbitration. Uber first suggested at a hearing on March 16 that it would try to force Waymo into arbitration instead of litigating in federal court. On March 22, according to Waymo, Uber lawyer Arturo Gonzalez of MoFo said in an email to a Waymo lawyer that the motion would be filed the following day. Instead, Uber waited until three days later to file its motion.

The timing is significant because the judge overseeing the litigation, U.S. District Judge William Alsup of San Francisco, has scheduled a May 4 hearing on Waymo’s motion for a preliminary injunction to block Uber from using supposedly misappropriated information. The judge told both sides at the March 16 hearing that he didn’t want to go to the trouble of a preliminary injunction hearing if the case is going to end up in arbitration.

Uber has proposed an expedited schedule to get its motion before Judge Alsup on April 13, three weeks before the May 4 injunction hearing. The proposed schedule would only give Waymo until April 3 to file its opposition to Uber’s arbitration motion.

That’s not long enough, Waymo said in a filing Tuesday - and Waymo should not be disadvantaged by Uber’s delay. If Uber had filed its motion on March 23, Waymo said, an ordinary briefing schedule would have given Waymo a full allotment of 14 days to oppose arbitration and still allowed Judge Alsup to hold a hearing before the May 4 injunction session.

“Rather than accept the consequences of their own delay, defendants have asked Waymo to sacrifice half of its 14 days to respond to defendants’ motion so that their motion could be heard before May 4,” Waymo said. “It is unreasonable for defendants to seek to have Waymo’s response time cut in half simply because defendants delayed filing their motion.”

Judge Alsup, who is all too familiar with the relentless litigation tactics of big tech companies from previously presiding over a hard-fought case between Google and Oracle, said in an order Tuesday that he intends to grant “a measure” of Uber’s proposed hurry-up schedule. He also said he’s not happy about the extent of redaction in Uber’s motion to compel arbitration. “Our federal courts belong to the public, and the public and the press have a legitimate interest in looking over our shoulders to see the work in progress,” he wrote. “Parties should not hide those arguments under seal out of a desire to shroud business dealings in secrecy.”

That part of Judge Alsup’s order prompted Uber on Tuesday to blame Waymo for the redactions – even as Uber requested a secret meeting in the judge’s chambers “to protect legitimate privacy concerns” unrelated to the redactions. Uber said it only blacked out portions of its arbitration motion because Waymo’s former parent, Google, insisted “that the existence of an arbitration (provision) and every word in its employment agreements must be kept in strictest confidence.”

I emailed lawyers for both Uber and Waymo to ask about the litigation gamesmanship. None got back to me.

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