Uber Takes a Trade Secret Black Eye (Next to It’s Other One!)
- The Knowledge Group
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Uber just can’t seem to find a break. First there was the loss of it’s CEO originally attributed to a family loss. Then out comes the sexual harassment claims of a male-only paradigm in the company. To frustrate matters further, it gets disclosed that Uber lost millions of people’s financial information to a group of hackers it then paid off to keep silent about the matter. Now the company is again being put in the spotlight for allegedly exchanging and trafficking in stolen trade secrets from other companies. As accused by a former security analyst that worked for Uber, Richard Jacobs, Uber’s management got a hold of trade information from Alphabet’s Waymo and then used trail-eliminating chat apps to destroy tracking evidence of discussions on the matter. It doesn’t help that Uber is in the middle of trade secret litigation versus Waymo when this letter from the former employee was disclosed.
As Uber’s legal team puts it, the entire matter is nothing and was simply an attempt to extort money out of Uber. However, as Judge William Alsup overseeing the litigation pointed out in hearings, Uber’s payment of $4.5 million to Jacobs after he was separated from the company sure looks like a whole lot more than nothing. It looks substantially and materially like a whole lot of something in legal terms. Waymo made full notice it would be looking into the letter and allegations for its case in expanded discovery demands on Uber as a result. The federal Department of Justice has peaked an interest as well from a criminal perspective.
The full civil trial won’t happen until February 2018, but Uber as a company is reeling from multiple scandal points and exposures now. With a brand new CEO who’s honeymoon and deniability period is rapidly ending, the company has to get back on its feet quick and get focus back onto its service. Despite all the salaciousness of office behavior and hiding trade secrets, the real issue Uber is a loss of control of its infrastructure. Given that financial information between riders and drivers is the bread and butter of the company as a middleman platform, sealing up its system from holes and regaining the consumer’s trust is a top priority. Cleaning house starts with management itself and realigning the perspectives and culture of the company to get back on the straight and narrow. Uber’s core team needs to stop behaving like it is still in a frat-party startup and start acting like a professional corporation with its business and practices.
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