Summary - Waymo was claiming Uber violated 8 trade secrets (down from 100s), and had only directly discussed these trade secrets for 45 minutes over the past week. "Can you really explain eight self-driving car trade secrets in 45 minutes?"
"And then there’s the part where Anthony Levandowski is not on trial, Uber is. Even if Levandowski took 14,000 confidential documents, that doesn’t mean that Uber did something wrong — there isn’t a clear link to how those documents got onto Uber computers or were used in Uber self-driving cars."
The lawyers did such a bad job. They bungled the litigation. Now it seems like they have endorsed a strategic option (settlement) that was way too risk averse.
Alphabet had already won the PR war. They had alot to gain by grinding Uber into the dirt. Now Alphabet comes off looking like a paper tiger for a settlement that requires Uber to do very well to have any value. Let's not forget they are a major shareholder in Lyft. I can imagine that Larry Page must not be very happy right now.
> Now Alphabet comes off looking like a paper tiger for a settlement that requires Uber to do very well to have any value.
The value of the settlement for Alphabet is not in the stock, it is in the “agreement to ensure that any Waymo confidential information is not being incorporated in Uber Advanced Technologies Group hardware and software.”
Of course, the details of that aren't going to be shared, but that's the thing matters.
> Let's not forget they are a major shareholder in Lyft.
Are they? I know GV has a significant stake in Uber, and Waymo has a cooperative deal with Lyft, but I don't recall Alphabet or any of it's subsidiaries holding a big share of Lyft.
Edit: as pointed out in the response, Alphabet is invested in Lyft through CapitalG.
I'm not sure how much I would trust any promise from Uber to not continue to use technology they already have, even if it was stolen. Uber doesn't seem the company to just say "Ok" and delete the information that wasn't theirs. I would be skeptical a lot of under the table development is still in action, but with a better mindset of not getting caught in place.
I'd imagine Uber's consent to not use waymo trade secrets comes with Uber agreeing that the points in contention are waymo trade secrets. Doesn't that mean waymo has a very good standing if Uber were to use these trade secrets?
I mean this is better than a patent because a trade secret will never expire in perpetuity, right? I also imagine this extends to anyone acting on Uber's behalf?
I'd imagine that the commitment to Uber and Waymo working together to assure that Waymo trade secrets are not used that is referenced in the settlement announcement involves more than Uber promising and Waymo accepting assurances at a distance.
According to the Techmeme headline Uber pledges not to use Waymo trade secrets: "Uber settles Waymo lawsuit, pledges not to use Waymo's trade secrets; Waymo will receive 0.34% stake in Uber worth about $245M"
Keeping employees from straying too close to the line of 'sharing trade secrets with their next employer' makes money for shareholders. There's a chilling effect.
The next Levandowski will think twice before following in this one's footsteps - even if their actions would be 100% legal. The next Kalanick will think twice before hiring him.
Levandowski can't be all that smart if he thought he could download 14,000 documents onto his work laptop, without Google noticing. I mean, hello? Any sane I/T security protection architecture would assume that despite the best security you can put on employee's laptops and mobile devices, a sufficiently determined criminal or state actor is going to be able to get onto the laptop.
So having extensive monitoring on work machines is not because you don't trust your employees --- but because you don't trust that the employee's laptop / mobile device is always going to be under the control of the employee. And if it does get compromised, you want to be able to state with confidence how much data might have gotten compromised, or how much access the criminal or state sponsored attacker might have been able to gain access to.
The fact that it can also be used to find incriminating evidence for back-stabbing employees who are intent on screwing over their employer is just a bonus.
And if he wasn't smart enouh to realize this, I wonder how much Waymo lost and how much Uber gained when they lured him away from Waymo. :-)
I would imagine that weakening a competitor in their space would be decently correlated with expected return for shareholders. Not sure where you got the idea that the only benefit would be "personal".
Sure, but I have a hard time imagining that "what happened to Levandowski and Kalanick", as individuals, is going to weaken Uber in the marketplace. If anything, going from Kalanick to Khosrowshahi might have actually helped Uber in the long run.
Yeah, I agree with this. Both Levandowski and Kalanick seem to be incredibly toxic people; removing or lessening their influence on Uber, and replacing them with decent people, would only seem to strengthen Uber's position and reputation going forward.
Which implies that Uber needs to start off it's plans to build driverless cars from zero or partner, which is precisely what the lawsuit was about. It's also what Otto's acquisition price was predicated on - that it had built IP from zero for driverless cars. The settlement is an indication that it did not do that, which means they'll likely have to scrap a large piece of it's incremental work.
> You're not allowed to use other people's trade secrets anyway.
Being allowed to do something and actually doing something are two very different things.
> The settlement is an indication that it did not do that, which means they'll likely have to scrap a large piece of it's incremental work.
That isn't true. Uber didn't use any trade secrets from waymo, thats why waymo settled. The point of the oversite is to continue to show that uber isn't using their trade secrets. There is no part of the uber tech stack that needs to be retired as an outcome of this case.
> Uber didn't use any trade secrets from waymo, thats why waymo settled.
Waymo has plenty of motivation to settle if they could get adequate behavioral commitments in the settlement, even if they thought Uber had and had used Waymo trade secrets. We don't know here details of the behavioral commitments around preventing use of Waymo technology, but their existence was in the public release.
Given that, if Waymo wins the self-driving race, Uber is a likely customer and is a company Alphabet already owns a nice chunk of through GV, there is plenty of incentive to minimize cost to Uber as well as Waymo while mitigating any risk of Uber using Waymo tech. Dragging out the court process isn't in anyone's interest, whether or not Uber stole and used Waymo technology.
> To be clear, while we do not believe that any trade secrets made their way from Waymo to Uber, nor do we believe that Uber has used any of Waymo’s proprietary information in its self-driving technology, we are taking steps with Waymo to ensure our Lidar and software represents just our good work. [0]
> Uber didn't use any trade secrets from waymo, thats why waymo settled.
This is still unclear.
> There is no part of the uber tech stack that needs to be retired as an outcome of this case.
Honestly, no one knows for sure, everything here (including my statements) is pure conjecture. Here's the reality though - Uber did not explicitly say "we absolutely 100% did not steal trade secrets". Outside the court of law, that tells me they are going to lose something of value...to what extent, I guess only Uber knows.
> The settlement is an indication that it did not do that,
Not really. The settlement is an indication that someone did an ROI calculation and decided that .043% of Uber is cheaper than the cost of seeing the trial to conclusion with the possibility of losing.
Based on what we all read in the news today, winning the autonomous race against a competitor is a double digit billion dollar opportunity. IMHO, the 0.043% is nothing more than a signal, rather than an absolute ROI. That number is a rounding error on a Alphabet balance sheet. If this was Oracle/SAP/Microsoft it would be a different story, where punitive damages are part of it's licensing model due to lack of growth from existing products.
If this statement is indeed true and Uber isn't totally brazen, then yes it would imply that Uber is going to have to seriously clamp down on how it uses the data/IP they got from Otto (which clearly they got from Google/Waymo). Not a lawyer, but that's how I read it.
They didn't get any IP from waymo, that is why waymo settled. There is no additional clamping down, they just need to continue to show alphabet that they're not doing anything fishy.
You're not allowed to use other people's trade secrets anyway
Sure you are, you're just not allowed to reveal them. That is, once they're revealed [to outsiders], they can be used by anybody. The only cause of action that I know of is to go after the revealer (as we have here), nobody who learns (and/or uses) anything from a disclosure of trade secrets has anything to worry about.
That's not really true. If learn a trade secret you cannot use it. If it became public knowledge through no fault of your own, it's no longer a trade secret.
Put if you steal the recipe to Coke and email it to Pepsi, they can't use it, even if use doesn't disclose it.
The law in California is complicated, and appears to hold that a company is liable if they "knew or should have known" the information they were using was misappropriated. This came up a bunch back in the SCOX v. IBM days.
The article is not a very comprehensive look at what's going on. The thread running through the comments - that the case Waymo had against Uber was flimsy - is questionable.
You don't toss someone a few hundred million dollars because your case is 'flimsy', and 'winning or losing' in court is too simplistic an analysis of the impact of the lawsuit on both sides as well as their third party competitors.
The Jeong article reads like someone read Uber's submissions to the court, phrased them in common vernacular, then ignored everything that didn't fit their narrative.
You do toss someone a couple hundred million in private equity for an immediate end to the damage to the company's brand, legal fees and recruiting efforts.
If Uber was in any real jeopardy of being found liable here they would have settled for far more. We know this because if Uber lost the case outright they would face an injunction against their self-driving business that would probably force them to license Waymo tech or put an end to the whole endeavor. Uber ATG is worth a lot more than what they paid in equity, and this is not an amount that matters at all to Google. The dollar figure is just there so Google can say they didn't come away with nothing.
> Uber ATG is worth a lot more than what they paid in equity, and this is not an amount that matters at all to Google. The dollar figure is just there so Google can say they didn't come away with nothing.
The settlement wasn't just for money, it also barred Uber from use of some of the disputed trade secrets/technology, which could be valuable for Google. Given that Uber hasn't monetized the technology yet, it would be hard to prove any damages. The outcome of a trial could have been a similar amount and an injunction and still been a big win for Google if the future self driving market is really going to be big and if the covered technology really was crucial.
No, Uber wasn't likely to settle for more, monetarily. The manner in which damages are fixed for trade secret and patent infringement make the total damages difficult to assess until the product goes to market. Google would be hard pressed to show actual loss, so Uber would likely be hit with some disgorgement stemming from unjust enrichment with some injunctive relief on the side.
What did they get? Unjust Enrichment sized damages and mutually agreed forbearance equivalent to injunctive relief.
And that's before we get into discussing how much of a minefield discovery was becoming in the case.
There is nothing in this settlement equivalent to injunctive relief. An injunction was the worst-case scenario for Uber and they would never settle for something that amounts to their worst-case, otherwise why not just finish the trial?
1) The most common and most valuable injunctive relief in IP litigation is an injunction to have people stop using your special sauce. That's literally what they got in the settlement.
2) Because prior to the trial there would have been a flurry of discovery related motions, a large amount of time pulling engineers off their jobs to have them perform witness prep at both companies, then a large period of pre-trial legal prep, then the trial itself.
At all stages, information is leaking, and expenses are going up.
... And then the appeals start.
... Then the partial re-trials and appeals on those.
It's a cost/benefit analysis. Waymo put forward a fairly weak case. There were damning elements of that case, for sure, but there were also weaknesses, and a case is a chain of reasoning that is only as strong as its weakest point. If Waymo was certain of victory they would not have settled, it would have been in their best interest to get things sorted in court and to get the maximum amount of money out of Uber. The fact that they settled is an indication that both parties were unsure of the outcome of the trial.
Settlement isn't an indication that both parties were unsure of the outcome of the trial; trials are never certain things.
Settlement is the most common way civil litigation disputes are resolved. Trials are the anomaly.
In this case, both parties likely recognized that getting into a knife fight about documentary production in a high-stakes race-to-market matter was likely in Cruise's favor, not theirs.
I think the last point really drives is home. Following the trial for a week, there honestly wasn't any strong winner. It was pretty weak on both sides, and no one could've really predicted which side the jury would've fell I think. It was down to game theory, they would both rather get a settlement than bet on the jury.
I think there might be still politics at play that GV is a investor at Uber. While Waymo is pretty unrelated to GV, there might have been "signals" from the parent company to quiet down the case.
Right. They extracted a fairly measly amount of money from Uber but more importantly they extracted a commitment that Uber would go the extra mile to prove they weren't making use of any of Waymo's IP.
Was this by their own will? Back in the Oracle v Google trial, which had the same judge, he asked Oracle to cut down the 132 claims to only 3 - which Oracle was not happy about.
I asked about this back in the Oracle trial and was told that if you can't prevail on what you consider your top 10 allegations, you are not going to be able to prevail on the rest of them (assumption they are weaker than your top 10). As a result litigating all of them is not useful and only serves to confuse the jury.
No. Judge Alsup told them to knock it down into the reasonable range. ("Less than 10") I believe it got stripped down to 9, and then one got thrown out of that group.
All the trade secrets claims were plan B for Waymo. The case was initially about patent infringement, and for undisclosed reasons they were all tossed out.
What was supposed to be the original slam dunk for Waymo, 'trade secret 96', Which referred to PCB circuit diagrams that were accidently emailed to Waymo instead of Uber ATG by a shared supplier, was even dropped. Waymo's whole case was pretty flimsy.
The prior art cited in that news item only invalidated 'patent 936'. (That's my comment there, 3rd from top). The infringement claims were thrown out earlier than that (September 2017, IIRC).
>...The infringement claims were thrown out earlier than that (September 2017, IIRC).
According to the article, the infringement claims were dropped after Waymo was notified of the USPTO reexamination that was going to be done due to Swildens filing the ex parte reexamination request.
>...So he took the unusual step of challenging the 936 patent himself, filing what is called an ex-parte reexamination request. He gathered the prior art he had discovered, completed reams of paperwork, and pulled together his detailed arguments into a 101-page document that he filed with the USPTO on August 1.
Waymo dropped the claims relating to the 936 patent on Sep 13.
>...Swildens, naturally, thinks his reexamination request played a role. He notes that USPTO had a phone interview with Waymo’s lawyers a few days before, on September 8, at which the examiners presumably told Waymo that a reexamination of the 936 would be going ahead. If the reexamination started while the patent was being actively litigated, Uber and the court would have to be informed.
I mean, yeah, 45 minutes is more than enough to exchange a ton of really critical information about a specific solution to a given technical/product problem (for example)...
there isn’t a clear link to how those documents got onto Uber computers
Just a minor correction: Waymo has not demonstrated that the files went any further than the disks Levandowski had. To date, nothing belonging to Waymo has been found on Uber's servers.
I am not sure that is a minor correction. My guess is that Waymo bet on finding such evidence through discovery, but all it ended up with is armfuls of what is, at best, circumstantial evidence of collusion.
> Can you really explain eight self-driving car trade secrets in 45 minutes?
Maybe I'm fooling myself, but I think I can do that in 45 seconds.
- hey what's your learning rate scheduling for module X?
- we use an EMA with coefficient 1e-4
- oh great, and for Y, do you do constant strides?
- no we use backtracking to figure out some sampling heuristic
None of which would be useful for a judge or jury. Heck, I'm generally pretty decent technically compared to the rest of the population and what you wrote here is barely relevant to me.
Sure what I just wrote is technobabble, I don't have much self-driving car expertise, but it was just to make a point. From my experience with large scale engineering projects, especially ones with ML involved, the tiniest details can make the stupidest difference.
Is this uncivil? I can see why its unsubstantive (Although my parent wasnt exactly substantive either). Whether or not its against the rules - do you understand my point?
It doesn’t matter, but for the record I don’t think you’re right to assert this is uncivil. I didn’t write it pejoratively, I thought he was focusing on an extraneous detail and missing the bigger picture, which is (imo) the meaning of obtuse. I think if you’re in battle mode then you’d be inclined to take it as an insult, but I don’t think it must be one (and I don’t think it’s wise to write as though everyone’s in battle mode - to cater to that)
I believe you that you didn't intend it pejoratively, but if you post a comment that takes that form and don't provide information that clearly signals your intent, plenty of people are going to take it that way. That's not a question of stylistic taste, it's an empirical observation about how internet forums work.
Even if 90% of readers guess your intent correctly—an unlikely number—that leaves hundreds if not thousands who read it the other way. It doesn't take much to provoke some of them into replying in kind, and that's the downward spiral we're trying to avoid here.
The 45 minutes she's referring to, is the 45 minutes that Waymo spent talking about it in court. Not 45 minutes that Levandowski spent talking with Uber employees.
If all of the models line up a ton, an expert witness could explain that these the chances of reaching the same tuning on all these choices via independent work is practically 0.
As someone who has been on two juries, I object! Jury selection is complicated, and there are limitations to how many potential jurors can be struck. There are also multiple strategies that legal teams may adopt. In my last trial, the plaintiff made a very emotional case, but the defense presented a very logical case. There were two jurors who I would say were logically minded, and we were able to influence the rest of the jury, who were tending to stick on what I thought were irrelevant points. A lawyer friend of mine said that she has seen that one or two logically minded jurors can often steer the jury, and if she is able to put together a logical case, she wants to get some logical people on the jury. (However, being a public defender, she is not always able to put together a nice logical case. She has to do the best she can with what she has to work with.)
Aren't you proving cbhl's point? When she can't put together a logical case and has to rely on "this person has kids please don't send them to prison for this crime they obviously committed," she's going to be trying to keep off the most logical and articulate people at any costs.
> When she can't put together a logical case and has to rely on "this person has kids please don't send them to prison for this crime they obviously committed," she's going to be trying to keep off the most logical and articulate people at any costs.
Nah, people who support nullification based on perception of the specific case and offender circumstances are not generally less logical and articulate than others.
You obviously want to eliminate people who either see the law as inherently just or see it as important to uphold the law even when the result would be unjust, as well as people inclined to see punishing your client as just despite the circumstances. But there's no reason, in general, to think that logical thinking or articulateness are, in general, going to be good correlated for those moral inclinations.
> lawyers always try to dismiss smart people from juries?
Lawyers don't “always try to dismiss smart people from juries”, or even try to identify smart people.
They do try to remove people that they expect will be more likely than average to be unfavorably inclined to their client or specific arguments, or that they expect to be a wildcard because they will be unable to restrict themselves to the courtroom presentation.
Neither of those, in general, is particularly correlated with intelligence.
the tweet you link to is architectural search, or figuring out what the neural network should look like (along with its parameters).
If self-driving car ML is "data scientists replacing a driver with computers", architecture search is computers replacing data scientists. $1.2M is roughly 3-4 data scientists' annual compensations at a company like Google or Uber.
Finding hyperparameters for an existing architecture is much easier because you would typically deal with a much lower cardinality in hyperparameter space. SigOpt is helping with that. Google has an internal solution that is able to take advantage of parameters within their job scheduling infrastructure (they actually have a bunch of them, the one I'm talking about is called hyperband [0]). CERN, as far as I know, was using hyperopt [1]. Avant uses an open-source version of SigOpt that we wrote in 2016 called loop [2].
Before this gets inundated with people making comments about Googler data scientists making $400k, these are folks with PhDs in math or statistics, very accomplished academic literature, leaders in their fields. These are not people messing around with Haskell on the weekends and leaving an insurance firm's IT department to go to Google.
There are enough non-executive engineers at Google making half a million or more base/cash comp that you could fill a room with them. That's not the point.
So, I am sure this will get downvoted, but thi is not my field - but as a curious person.... can you please explain in-long-hand-but-still-like-I-am-5 what your comments means?
coursera has a great course on self-driving cars. the only prerequisite is a college course in linear algebra and some python knowledge. If you don't have either of the two the course is still very much approachable - you'll just have to learn two (or three) things at the same time, so expect to double (or triple) the time you sink into it.
It is quite simple to explain. When your best guy gets hired away from your company, you are generally angry at the company that stole your employee, not the employee. Most of the tech is still trial and error so patents don't hold much water at this point unless you are TESLA. So this was always about "See what I can do to you because you hired my best guy"
Really surprised this ended so quickly. Did Waymo and Uber reach a settlement that early because:
- the former felt this was the "best" it could get in such a situation as their case was not as strong as they initially thought
- the latter was not keen on having its image dragged into the mud any further and may also be aware that more incriminating material could surface if Google or others dug further?
IANAL, but I find the resolution of this case quite puzzling... Also what does it mean for Uber's self-driving car development efforts?
It does have the feel of a TV show at this point. Given @sarahjeong's coverage on Twitter and in the Verge I would not be surprised if Waymo's legal team felt they were going to at least not win, and might lose.
And to my thinking Waymo had lots more to lose than Uber did. (and I think that is reflected in the settlement being not quite 13% of what they were asking, and in stock which may be completely worthless). Waymo loses and it might embolden other Google employees to go to competitors, it might embolden those competitors to try to recruit their top engineers to bring their ideas into the competitor. It might completely blunt Googles ability to get any engineer to believe what the company thinks of as trade secrets would actually be considered trade secrets in a court and so they aren't as threatening as before. And on cross examination Uber might have pulled some things into open court and the public record that Waymo would rather not have out there.
Uber on the other hand already has a reputation as being a rule breaker, and skating over the line. So what do they have to lose? I Waymo can take $1.9 billion in cash out of Uber (maybe more if they can get lawyers fees etc) they can take them off the board completely.
According to the coverage they were being berated by the judge and their case had gone from being about patents to about trade secrets to about 8 trade secrets. That is not a legal case gaining steam, that is one that is trying to stay alive.
Great analysis.
I think after Waymo's lawyers screwed things up almost as bad as Samsung's did in their Apple trial that they wanted to end it ASAP.
Kalanick and Levandowski are already gone, their's and Uber's reputation has been soiled from this, and I'm pretty sure all the bad PR stopped Uber's valuation from skyrocketing even more.
Lewandowski's credibility is in the gutter after this. There is proof of him siphoning confidential documents, data, from Google's internal systems.
I'm not sure how Waymo losing would make it less threatening for people to do the same thing? They now know more than ever that anything they do to internal/confidential data is being monitored.
Lucky for him he seems to have escaped with enough money that he can live comfortably without ever being employed again. If you look at his situation objectively I find it hard not qualify him as pulling off the heist of the century. He gets a ton of bonus money from Google, he gets a bunch of buyout money from Uber, he gets Uber to indemnify him from any legal repercussions. And he has plenty of cash to make it super painful for Google to try and claw back anything as well.
So change your name, move to a different area, change your hair style and voila, playboy at large.
Please don't post unsubstantive or name-calling comments here. "Silicon Valley lawyers" may or may not deserve better, but the HN community certainly does.
Waymo's trade secret violation case was flimsy so they were willing to settle, and Uber from the beginning has been looking for the quickest way out.
Even if Uber could have won the case, their reputation is now such that if you see Uber in a headline, you are primed to think "scandal" or "evil" - even if you see "Uber wins Waymo case" you'll think "wow I wonder what shady stuff Uber did to pull that one off against Google".
I'm interested to see if Waymo pursues anything directly against Levandowski.
To support your point, I don't believe for a second that Uber is actually innocent of intentionally stealing trade secrets. Far more likely that they they had the foresight not to keep any documents of their foray into industrial espionage, knowing that getting caught if there simply isn't any trail is very unlikely.
(I mean, this is the company that remotely wipes machines to avoid complying with search warrants, under a CEO that appears to think that the ends justify any means...)
At one point, Waymo initiated arbitration over the issue of poaching employees, but the taking of trade secrets was excluded from that case. Did they subsequently go to arbitration over the latter? And, on the other hand, does the mandatory arbitration clause in Waymo's employment contracts mean that it can not take Levandowski to court over the trade secrets?
Anything civil must go to arbitration and criminal isn't something Waymo can initiate. Alsup recommended the DOJ look at the case. They may choose to investigate Levandowski.
The trial was turning into a circus. (Just look at Sarah Jeong's tweet storms about it.) I'm not surprised this happened in that light: it was terrible for the image of both companies and self-driving cars in general.
I don't buy the "it was a bad image for both companies". Do either of these companies really care about their image specifically when it comes to AD, other than simply "winning the market"?
I am very hesitant to use Uber because of their other ethically questionable tactics. This whole suit was furthering the notion that Uber has no limits to their desire to be number 1 - regardless of who they exploit or harm on the way.
Brand image matters a ton to both companies because they are fueled on user trust. Uber asks you to get into a car with someone you’ve never met. Google asks you to trust them with your entire digital footprint. If people have an “icky” image of them it will yield severe financial damage.
The judge was admonishing Waymo for showing what were essentially marketing materials to the jury in closed-door sessions. Their lawyers were showing clips from Wall Street in court. They were asking Travis Kalanick to explain video game terminology in ludicrous detail. And so on.
No company that aims to be taken seriously wants to be involved in a circus like that.
IIRC it was in the context of Kalanick/Levandowski quoting stuff and using these terms, so it's fair to present the jury with a "here's what they meant by it and what they were referencing".
For Uber I think it's obvious. For Waymo, well, to use the Words of former program manager Chris Urmson in a late 2015 letter to Sergey Brin (Which Uber's lawyers trotted out as part of their defense) "Over the past 6 months we have stopped playing to win and are now playing to minimize downside."
Waymo joins Tesla and Baidu as self driving car companies who have levied lawsuits over top engineers leaving their projects to become competition.
Waymo became a minor investor in Uber in future can vote for Uber to buy or rent it's cars. If I recall correctly Google ventures was an early investor in Uber as well. So Alphabet might own a lot more of Uber once it's Ipo
There is no evidence Uber has any trade secrets from Waymo that they would have to stop using. That was why Google settled. If Uber did have any trade secrets they would have lost the case outright.
Uber gave up 245 million dollars. That's not based on nothing.
Really, if it was an open and shut case Uber could have gotten it dismissed. The fact they figured giving up 1/4 a billion dollars was better than continuing to fight says a lot more about their situation than any internet commentators can. The only reason for them to spend that money is because they was a significant chance aka well over 25% they would have lost significantly more by fighting.
There is a secondary market for Uber stock that's moderately liquid. It's not a public company, but every shareholder takes a haircut when they hand out more stock.
It makes a lot of sense to me. Google cares much more about Uber not stealing their trade secrets, than about money. I strongly suspect that once Travis left and Dara took over, Dara was able to convince Google that Uber would behave appropriately from now on. The lawsuit served its purpose by helping to force Travis out.
One thing is, for tech companies, generally if you're in court you're losing. It sucks away time, money, attention, and PR from the rest of the company.
I think the case resolved nicely. Both of them get it resolved on a Friday so everyone wanted it to be swept under the rug (especially with the markets being front and center). Uber and Waymo will still compete with each other for self-driving cars but most likely will be hobbled in their efforts due to the kerfuffle.
This has to do with the IPO. Ideally the lawsuit will be done before the IPO so there is no uncertainty about future liabilities. Even if Uber won its unlikely that the appeals will be done before Uber wants to IPO.
Perhaps this quick settlement is driven (sic) by the possibility that self-driving cars don't work, and neither party wants that situation to be exposed in open court?
ars answered perfectly for me, but indeed I believe it is not going to work. Impossible? Well that depends -- for some constrained version of the problem (no human drivers, special lanes/roads for SDVs) perhaps. In the distant future when strong AI has been built, well sure then it's easy.
That's a stale valuation, Uber's latest round was significantly down from that. The Softbank tender valued Uber at $48B, so a more up-to-date estimate would be:
A tender offer is not a round. Most tender offers for stock (common or preferred) in illiquid companies are at a discount to new preferred stock from the most recent round.
This happened with multiple other companies like Facebook and AirBnB, so I don't see why in the case of Uber that anyone who is informed can conclude that it was a down round.
Could they, though? Uber's valuation is based on its taxi technology business. The self-driving stuff might be their long play, but certainly not the source of their value.
I have no idea what kinds of damages Waymo might have been able to extract from Uber, but it seems very unlikely that it would have been in the multi-billion-dollar range. $245 million is a huge sum, add to that the saved cost of ongoing litigation.
Nonsense. SDC becoming viable on scale is decade or two in the future. Uber is valued based on its ride sharing and food delivery business. Investors apparently believe it can be profitable on big scale therefor good investment.
The value of the taxi technology is predicated on surviving high losses for a few years to secure riders for the autonomous fleet that will emerge. The driver component in the current equation is 100% subsidized by investors.
This isn't about something new happening in the fight itself- it's about the economy lately (imho).
This was a fight they could have drawn out. They could have claimed it wasn't their fault, they could have paid enough legal fees to win the day. But it was always going to be a waste of time, in a literal sense. Years could have gone by before any decision, holding back Uber the entire time.
Uber is still a black hole for money but VCs see it's potential and keep throwing money at it. So long as that money kept coming, Uber could do anything they want really.
But then the market started crashing. The last week has been a wake up call that things are a-changin'. In another six months, there may not be VC money being thrown around anymore. And then you'd have Uber actually in a crunch. What then?
By settling today, Uber may have the time it needs to get their self-driving fleet in the road before the money runs out for good. That's all that matters to keep the company alive, and Khosrowshahi knows it.
But if he'd been smart, he'd have settled six months ago instead.
No, but business folks can hammer out a settlement "in principle" in hours, and everyone can go "pencils down" on a dime. Papering things up can take longer, but courts love to get cases off their docket and will happily oblige by staying schedules in the meantime. Press releases can go out long before the motions to dismiss are filed. This happens all the time.
Apologies, you're right. My reply was pretty dismissive and snarky (hey, it's HN, that's what we do, right?) but I should have been more thoughtful in my response!
I think this is probably the product of months of negotiation. First on the big parts, then on every damn detail down to the color of the ink. It's called professional lawyering. That said, total speculation on my part and maybe obviously IANAL.
stock market != economy. People have been used to easy constant gains but this bull market has had the benefit of low interest tailwinds the entire time. Before the 2009 crisis, potential interest rate hikes would always act as a stock headwind.
An economy getting hot leads to higher interest rates which makes stocks less tempting due to risk-free alternatives getting better. So it's very easy to have scenarios where stock market declines are occurring while the the economy is doing very well. That's what appears to be happening now, there are no economic indicators that show the economy is faltering at all.
I think what happened is Levandowski and Uber acted in a very suspicious way that lead Waymo to conclude that Uber must have stolen its IP. But then when it came to discovery they couldn't find solid evidence (either because the property was not used, or Uber managed to destroy the evidence), and so Waymo realized it was probably going to lose the trial.
In the meantime, the lawsuit helped kick Kalanick out, and he was replaced by someone much more reasonable who wanted to end the lawsuit. As a consequence the two parties were able to come to an agreement.
This theory is so wildly off from what my lawyer friends have told me about the case (including one who has 5+ years of IP law experience)
They are mostly in agreement that Google had enough to win the case but that they likely had the worry that juries are always unpredictable and you really never know what will happen. They seem to believe that the thing that Google cared about the most was restricting Uber's usage of the stolen technology. They believe that Uber felt they had a decent chance of losing so they mutually agreed to setting, giving Google what they wanted (restriction of the technology usage). Once that was offered Google immediately moved to settle since that was what they wanted from the outset and any additional cash or destruction of Uber's image would have been beyond their needs.
If you look at the settlement number, 0.34% of Uber at 72B (yes, 72B, not 45B as the recent down round which would equate to 150M), then you'll see that Google did not expect to win this case.
The question remains what really happened. One possibility is that Levandowski and Uber really did have a plan to steal Waymo's technology, but then didn't actually use it. Like maybe it wasn't as good as Uber thought it would be, or for some other reason they didn't adopt it.
The reason I say they didn't use it is if they had, then it would still be there in Uber's technology, and it would be easy for Waymo to prove that in court, and so they would have had no motive for settling.
The other possibility is that it was never planned to be an IP theft. Maybe Uber payed so much just because it was desperate to hire Levandowski.
But then the question is why Levandowski copied the files. His explanation that it was to guarantee he got his bonus doesn't make much sense, and so it seems pretty sure he invented it after the fact when he got caught. But maybe he was just being irrational at the time and that really was his reason, or maybe he had some other odd reason for doing it. I mean, it is pretty clear he is a person with, shall we say, "non-standard" ways of thinking about things.
I wonder if we will ever learn what the true story was.
> The reason I say they didn't use it is if they had, then it would still be there in Uber's technology, and it would be easy for Waymo to prove that in court, and so they would have had no motive for settling.
Time is a motive for settling, as is the fact that even with the best case juries are unpredictable.
The money at issue probably isn't a big deal to Alphabet, the behavioral consequences are. If what they've got in the settlement on that front is, in their view, adequate to ensure that their technology isn't going to be used to compete against them, getting that now is probably better than going through the legal process and getting to a judgement.
I doubt they destroyed evidence - if they acted nefariously, they probably just operated in a manner that did not generate evidence. I'm just a middling employee in a big company and it is drilled into my head how to, basically, not leave a paper trail for important topics.
Anyone who thinks this is a loss for Uber doesn't know what was at stake in this case. At one point an injunction against Uber's self-driving division was on the table. If that were still any sort of possibility Uber would have ended up paying far more than a couple hundred million in equity to settle the case.
I think it's safe to say this wasn't really about theft of trade secrets by Uber. We can infer this because Google's lawyers would have known exactly how weak their case against Uber was when nothing of substance turned up as part of discovery. Google decided to go to trial anyway. They knew that Uber's ailing brand would make them _seem_ guilty in the public eye even though they clearly weren't.
I can't prove this, but I think this was a chillingly opportunistic move by Google that was designed mainly to stop the loss of top engineering talent to Uber ATG. After all, who would want to go to join a company which appeared to be in serious legal jeopardy?
I'd speculate that Uber's current leadership saw an opportunity to immediately stop the damage to their brand and took it. Part of me wishes TK were still running the show because he probably would not have settled.
"To be clear, while we do not believe that any trade secrets made their way from Waymo to Uber, nor do we believe that Uber has used any of Waymo’s proprietary information in its self-driving technology, we are taking steps with Waymo to ensure our Lidar and software represents just our good work."
I feel like there's a contradiction inside this sentence.
Is this an admission that some of Uber's technology came from Waymo, but merely things that are not trade secrets / proprietary information?
It is not a straight-forward admission of guilt, but it is much more of an admission than you usually see in these sorts of cases. It seems pretty clear that the new CEO thinks they had some real ethics problems at Uber, and is sincerely working to straighten things out.
He's probably going to be sued by Waymo, likely with Uber's full cooperation. The part of Google's case that always seemed the strongest was their forensic evidence of his misconduct just before he left. He could also be sued by Uber if he lied or omitted anything during the Otto acquisition.
I don't see how it's unclear. You can't go through arbitration and then sue because you want more than arbitration awarded you. The entire point of arbitration is that it's binding and final, specifically to avoid the messy lawsuit process.
Arbitration does not and cannot cover crimes. Arbitration is a civil matter. I would imagine that the arbitration agreement included a clause along the lines of "Alphabet will not pursue any further legal claims against Levandowski related to his time of employment." and vice versa.
I could be wrong, of course, but I doubt arbitration left open a lot of space for future action. Without the arbitration being unsealed, though, I have no way of knowing.
Of course, the US DoJ and/or California equivalents can still pursue criminal charges against Levandowski.
Probably true. But if he made fraudulent or false statements during arbitration that are later proven as such, I assume that could reopen him to lawsuits
"But the prospect that a couple of Waymo employees may have inappropriately solicited others to join Otto, and that they may have potentially left with Google files in their possession, in retrospect, raised some hard questions."
"Hard questions" -- That's a good one! Not only because of its velvety-smooth use of euphemism, but because it's basically true: We enlist the help of the judicial system to answer questions that are hard. And an accusation that the accused denies, fits in that category. Filing a lawsuit is essentially asking a "hard question" along the lines of "Should the other party be obligated to compensate us for damages?" One side says yes, the other says no. Hard question!
I'll have to use that one sometime. I really need to learn the art of executive-speak if I'm to advance in this life. But I suspect I'll just stubbornly stay my same tactless self.
This kind of language must be intentional given the team that reviewed and edited the memo, which makes it worse to my ears. Either "may have" or "potentially" would have sufficed.
google used to own 7% of uber. I don't know what it is now, but lets say its 5% that stake would be 3.5bil at 72bil valuation . If they are getting .34% essentially they are losing money from GV losing money as a share holder while waymo is gaining some, but they are both google companies.
I don't see how this lawsuit benefits google shareholders as a whole. They just wasted money on lawyers.
Won't they make money in absolute terms? Maybe it was a waste of time. But, 0.37% of Uber is $245 million. I can't imagine Waymo spent that on lawyers, investigators, etc.
Google has an in-house litigation team that would have already been on payroll. Sure they had to pay for expert witnesses and court fees, but the total would be far less than what they settled for
When Intel stole Digital's alpha technology the lawsuit ended with intel acquiring the Digital chip business. I guess that's also sort of money, but not exactly.
I recall earlier news stories that Waymo's first settlement proposal last year included demands for a public apology from Uber. Is this that? I wonder if Uber is also paying $1b like Waymo initially demanded, or if that part changed as well.
That was quick. What would Uber and/or Google have been embarrassed to see become public? And will Lewandowski get to quietly sneak away, or will both companies now pillory him?
Once evidence is revealed, there isn’t much new for lawyers to discover: good, experience negotiators know what angle the other side is going to take and after opening arguments, even that is pretty settled.
I appreciate the overall conciliatory tone (with the usual “we did nothing illegal” caution) but I’m not seeing mention of any financial settlement. I can’t imagine that didn’t happen.
I have to say that this is kind of surprising but thinking about it all logically it seems like there is a lot more to this story.
First off as others have pointed out Waymo's case wasn't a slam dunk. So they settled for way less than they originally wanted.
But there are several other interesting things to note. Because of this case there is now a criminal investigation into Uber's acquisition of Otto. I feel like part of why Uber settled was because they knew this was being investigated and dragging out this case in court may have made public some really incriminating evidence in the criminal investigation.
What further leads me to believe this is the case is the fact that the current CEO has basically admitted that the acquisition of Otto should have been handled differently. It seems like they knew that Otto may have stolen trade secrets from Waymo. It also appears that Uber may have had helped set up Otto from the start to acquire such information. For this we will have to wait and see how the criminal investigation shakes out. At which point we could see federal charges appear against Uber and Levandowski. We may also see the SEC step into this as well if they did appear to set up Otto as a Shell company to acquire stolen technologies. Time will tell.
If they do, Waymo will most likely have a clause that allows them to pull if away or a price point that prevents Uber from operating profitably once Waymo is in full force.
A small sign of that: I generally order Ubers from Google Maps. Until recently, I was sent to Uber app; lately, it’s an entire experience through GMaps. I suspect they are planning to switch that default to Waymo wherever they are.
You can book either Uber or even Lyft from Google Maps (assuming they are available in your location). Once the ride starts, you can follow progress from either Google Maps or the Uber app. You can still book and track the whole thing from the Uber app, of course.
I prefer GM because it has all my bookmarks, it doesn't download the same map tiles again, etc. Until recently, it was quite annoying, because you were trapped in "Uber mode" during a ride. As of a few months ago, you can go back to the base map, start new searches, look up transit directions, etc. and later return to your ride's status.
Full disclosure: I prefer to walk and public transport, so I generally use those when I’m late. This means that I rarely use any and I tend to pick whichever seems to work seamlessly, namely the one not asking me for my credit card number, asking to confirm my phone number with a SMS handshake that takes five minutes, etc. I remember navigating between several options including Addison Lee (a local equivalent in London), local taxis if they have an app (in Stockholm: great service, inexplicably expensive).
That does mean that Google Maps will win and its default option too. I suspect that the way they display services, notably prices and availability will have a dramatic impact too: at the moment, it’s a band. It’s all too easy to show a cheap low price for instance and I suspect that Google Maps might want to argue that they should review estimates and compare them to actual charges to enforce consistent labelling. Same for availability: you can say a car will be there in three minutes, but have that change to five once you clic, etc.
Overall, it does look like an anti-trust issue. I guess, in that case, a China-Wall between Google Maps and Waymo, transparent ranking process, etc. would be necessary. I can’t imagine not having access to either a mapping service, or the convenience of comparing public transport with ride-hailing.
I’ve been an advocate for auditing a lot of algorithms by publicly-appointed experts for a while now. You need a good understanding of machine learning to audit the political impacts of Facebook News Feed and the Call to Vote button, for instance. Not all countries can appoint their expert though, so we might need to have smaller countries agree to trust the expert from larger nation groups.
Are you asking whether you have to use Uber? It gives you a list of providers.
If you're asking whether you can ask maps to switch into the Uber app, I'm not sure there is a lot of value (you can pop open the app and your ride appears there too). Uber exposed developer APIs presumedly for this reason. Embedding the UX lowers friction and tightens up the user funnel.
In the mobile app, request directions of a location and there's a rideshare icon (a person holding a suitcase with their other hand hailing a cab). For me it's between the walking & bicycling options. You're presented with several options from both Uber & Lyft, each with a price range.
> To be clear, while we do not believe that any trade secrets made their way from Waymo to Uber, nor do we believe that Uber has used any of Waymo’s proprietary information in its self-driving technology, we are taking steps with Waymo to ensure our Lidar and software represents just our good work.
At what point do statements like this start to harm a company rather than benefit it? It is plain to see that they are lying; if the first is true the second part would not be happening.
Uber and Waymo announced on Friday that they had settled a high-stakes court battle with Alphabet subsidiary Waymo over trade secrets related to self-driving cars.
As part of the settlement, Uber will pay Waymo 0.34% of Uber equity, valued at Series G-1 round at an approximate $US72B valuation.
Uber’s CEO also “expressed regret for the actions” that led to the lawsuit.
It is interesting that Alphabet will accept stock because that means they believe they can carry it to market (or at least, won’t lower its value until it does) which might still take more than a year.
This could mean Waymo will probably not be able to announce anything significant until then: Uber would suffer from having such a big rival step up. Internal politics at Alphabet must be fun.
> It is interesting that Alphabet will accept stock because that means they believe they can carry it to market (or at least, won’t lower its value until it does) which might still take more than a year.
It doesn't mean Alphabet thinks the stock won't lose value, it means that they think that it won't lose enough value to be worth less than what they could have gotten in cash, either in a settlement or (discounted for risk and time, and netted against the expense of continuing) from taking the lawsuit to it's conclusion.
> This could mean Waymo will probably not be able to announce anything significant until then: Uber would suffer from having such a big rival step up.
Is $245 million really worth any significant risk to Alphabet’s position in self-driving cars? I suspect they’d accept the risk to the value of the Uber stock to maximize their own future prospects in that market.
Alphabet's probably accepting stock because they're one of the most risk-loving investors possible.
They've already got a business that's spinning off tons of cash, so they have no need for money, and instead, are pursuing any possible avenue that has the potential of making $$$ (e.g. all of the other bets).
That amount of money is a rounding error to Google, especially since it's in the form of private equity issued by a company they already have a stake in worth billions. Google probably negotiated for the equity to be included in the settlement just so they had something to show for this case.
It doesn’t make sense to apply anthropomorphized motivations to giant corporations. Google’s IPR management is not that different from the others. They will litigate if it’s to their advantage.
Maybe the reason Google hasn’t been suing much until now is that they’ve largely been on the borrowing end of the deal (cf. Android’s debt to Sun and Apple).
Just not Google's approach to sue others. Think in this case just too much too let it go. You can see it elsewhere with all the research papers and open sourcing so much software. I mean OS K8s was a little nuts, imo.
Levandowski was fired from Uber, is still in arbitration with Waymo, and possibly has a federal investigation pending against him (which is why he has, and was planning to, take the fifth amendment). I'm not sure how it "paid off" here.
They did get rid of a handful of employees that were considered rowdy, handsy or sexist. Internally, I’m told the changes are quite dramatic. The public tone around the legality of their offering, notably in London, is a bit like this note: far more consensual but not clearly stepping down. They want to serve London and Londoners need the service (minicabs aren’t able to produce software at the quality Uber does) so to me, that sound much better. More recently, they did publish detailed data to help a conversation on gender-balance of their driver compensation (not where I expected them to have their main problem, but good for them to inform the conversation on pay gap).
I don’t think Dara is an angel, far from it — I got internal rumours that he’s more than willing to punish good people if that makes him look tough and, honestly, he needs to. Rather than let him cull randomly until he feels like he’s done enough, we could help him pick the bad:
Were would you expect them to lead? Serious question: I know many employees read HN, and I’m happy to point some of the more respectful and change-prone ones to your suggestions.
It's amazing how judicial system works fast in the USA. In my country both companies would go bankrupt and would still be suing each other due to sunk cost fallacy.
This is disgusting. I recognize that the moat that the government provides via the nonsense system that is IP is an incentive for investment, but the very notion of intellectual property should fly in the face of the moral code of every single person who works at a business built on Linux or HTTP.
The future the Earth needs is only delayed by these moats of who-can-use-which-research.
You don’t own your discoveries or ideas, any more than you can own a song that you sing to another person. The moment something leaves your head, that information is no longer yours—it enriches the whole world, and that is how it should be.
I am the staunchest defender of property rights—but information can never be property.
Property is an artificial construct, it's up to society how we define what property is and how laws protect it. In this case, Google and Waymo are literally building fake cities to create this IP. That money needs to come from somewhere or that research won't happen, and a temporary monopoly on the IP it generates seems like a fair trade-off for society.
It's not obvious to me that property beyond one's own homestead would be considered a natural right rather than a "made up" right, but I'm willing to be convinced. Are you advocating a Lockean theory of property?
Really? As an extreme example, if it costs $1B for a company to develop some IP (1000 people working for 5-6 years) that IP should just be freely shareable?
Spend can't really be the reason a company gets a public good, right? If I want to own a city park, and I spend a bunch of money trying to own it, that doesn't mean I do, in fact, own it or should own it.
Society should give (or "lend", in the case of a patent) a public good to a private entity if and only if the societal benefit outweighs the societal loss of giving out the good. Maybe your argument was shorthand for something along those lines, but I think it's important to distinguish.
I'm not sure I agree. Let's take "cure for cancer" as a theoretical thing that can be accomplished with $nB in research spending.
What is the incentive for companies to spend their resources trying to find a solution for this if society can effectively nationalize the results as soon as they are obtained? If a company cannot recoup their investment (and their risk) then they're not going to spend the resources in the first place.
It's far better for public institutions to have well funded research programs for "IP" that serves the public good. If companies get there first, by all means "lend" them the patent (as long as the "loan" expires after a reasonable period of time.) This is largely the system that we have today, and while not perfect in many respects it does ensure that both public and private entities are chasing big goals.
That seems like a poor analogy, if you mean the park already exists and the company is just trying to take possession of it. In this situation, there is no park at the outset, and the company would have no incentive to build one if it didn't have some way to benefit from it once built. Companies will only create this kind of IP if they can profit from it; they're not charities. If we as a society want this IP to exist, our only options are to protect the profit motive that leads to its private creation, or (like the park!) fund it publicly.
Or, perhaps being the first to develop a new technique is actually a sufficient competitive advantage to fund the research. This is surely true in many cases where a first mover advantage is large. If you look closely, I think you'll find the research costs in many areas that are prone to making this argument (drugs) are not nearly as large a component of the company's costs as you think.
That only works when you have a way to ensure that people who invent things have a way to make a living. Most people working on open source do it as volunteers; only a few have it as part of their job, and the ecosystem suffers.
Deep research requires investment or public funding. If you can get congress to fund it, then more power to you - but until then, people have to make a living from invention.
so you'd be alright with someone stealing something you spent billions to discover through R&D? Who would invest money into R&D if a competitor could just steal it for free?
https://www.theverge.com/2018/2/8/16993208/waymo-v-uber-tria...
Summary - Waymo was claiming Uber violated 8 trade secrets (down from 100s), and had only directly discussed these trade secrets for 45 minutes over the past week. "Can you really explain eight self-driving car trade secrets in 45 minutes?"
"And then there’s the part where Anthony Levandowski is not on trial, Uber is. Even if Levandowski took 14,000 confidential documents, that doesn’t mean that Uber did something wrong — there isn’t a clear link to how those documents got onto Uber computers or were used in Uber self-driving cars."