Well, that was fast! After what was supposed to be a blockbuster tech trial, Uber and Waymo reached a surprise settlement yesterday. What does this all mean? Senior RSG contributor John Ince breaks it all down for us – and let us know what you think in the comments!
Waymo and Uber reach a surprise settlement [The Verge]
Sum and Substance: After months of buildup and nearly a full week of courtroom wrangling, the two sides in the Waymo v. Uber lawsuit have reached a settlement, and the case is being dismissed with prejudice.
An attorney for Waymo announced the settlement this morning and was met with gasps of shock from reporters and members of the public who had crowded into the courtroom in San Francisco in hopes of seeing more drama. Judge Alsup granted the motion to dismiss, and with that, the case is, in his words, “ancient history.” This was supposed to be day 5 of the trial, which was expected to last at least another week, likely more.
So who gets what? Waymo gets 0.34 percent of Uber’s equity at the company’s $72 billion valuation, which works out to a value of around $245 million. Waymo had originally sought a $1 billion settlement last year before the trial got underway, but Uber rejected that deal. Both sides are responsible for paying their own legal fees. “This is all equity; zero cash,” said a source familiar with the settlement. “It means Waymo is invested in Uber’s future.”
My Take: Well, that was quick. Just when all of us in the bleachers were starting to get into the drama, they called everything off. What a disappointment.
No chance to see Larry Page or Sergey Brin on the stand getting grilled by Uber lawyers. Come to think of it, maybe that’s why both sides agreed to the settlement – they didn’t want all the distractions. It was supposed to be the blockbuster trial – center stage – the ongoing saga: Rideshare Wars.
Even so, I’ve devoted the entire roundup to give different perspectives on what unfolded day by day this past week in a San Francisco courtroom. The trial was supposed to have reverberation throughout the tech world where IP (intellectual property) has become one of the most valuable assets on the balance sheet.
Isn’t it ironic, that after all the bad blood between these two companies, the settlement makes them even stronger partners with Waymo upping their equity stake in Uber? I wonder how they arrived at .34 percent. What do you think? Who won this battle? Or were they both losers?
Uber ex-CEO Kalanick: self-driving car beef linked to Google CEO Page’s ire over talent loss [USA Today]
Sum and Substance: After two days of legal wrangling, lawyers for Google’s self-driving car company Waymo on Wednesday injected a little bit of Hollywood into the protracted corporate scuffle over whether Uber stole trade secrets in its rushed quest to bring self-driving cars to the masses.
Michael Douglas’ voice rolled through the courtroom: “Greed is right. Greed works.” The iconic video clip from the 1987 movie “Wall Street” attempted to convey a clear message to the jury: Uber is an aggressive, greedy company willing to do anything to win. Even steal from Waymo.
That sentiment played on Uber’s well-documented history of ruthless business exploits that sometimes ran afoul of regulators and business partners. But the anecdote didn’t answer the fundamental question the case tries to resolve: whether those tactics extended to stealing eight trade secrets from Waymo as a short cut to developing key self-driving car sensors.
My Take: The trial was supposed to continue more than a month. But my initial take was that Google had a much stronger case in the media than in the courtroom. Waymo’s lawyers were able to paint Uber as the bad guys, but proving they stole trade secrets would have been much more difficult.
Even so, Google is not known as a litigious company so the very fact that they brought this suit to trial in the first place is a pretty clear indication that TK really pissed off Larry Page. Anyway, that’s ancient history now.
In Travis Kalanick’s first public appearance since resigning from Uber, his competitive nature was put on trial [Recode]
Sum and Substance: The legal saga between tech behemoths Alphabet and Uber began with a bruising condemnation of Uber’s former CEO. “This case is about one competitor deciding they need to win at all costs,” an attorney for Alphabet said in his opening statement on Monday.
“Mr Kalanick, the CEO at the time at Uber, made a decision that winning was more important than obeying the law,” he continued. On Tuesday, the second day of trial in the U.S. District Court for the Northern District of California in San Francisco, an uncharacteristically soft-spoken Kalanick took the stand to face these accusations head on. It’s the first time the notoriously combative former CEO of Uber has spoken publicly since he was ousted by major shareholders in June 2017.
While Kalanick, who donned a dark suit and tie, answered questions about his aggressive ambitions to win the self-driving car race, the normally emotive Uber co-founder appeared restrained even when asked to concede that Google was in the self-driving lead. The attorney asked if he agreed that Google is the industry leader for autonomous vehicles. “I think that’s the general perception right now,” he answered.
Kalanick’s testimony will likely be a central part of Alphabet’s argument. Alphabet is alleging Uber worked with former engineer Anthony Levandowski to steal self-driving trade secrets before he left Waymo, Alphabet’s self-driving arm, and created a startup that he would eventually sell to Uber.
If Uber loses the case, it could have to pay out millions of dollars in damages and potentially stall its self-driving efforts. For Waymo, losing the case will have largely reputational risks. Alphabet rarely, if ever, sues over any issues with people or other companies, which means this litigation carries a lot of weight.
Waymo’s strategy so far appears to be attempting to prove that Kalanick was fixated on beating Google and winning the self-driving car race at all costs, which could in turn serve to explain his motivation to conspire with Levandowski.
Uber contends that Waymo’s claims are baseless and that none of the files ever made it to the company.
My Take: One of the fascinating subplots emerging from testimony at this trial involved apparent discussions between Otto, the company Uber eventually acquired, and Lyft. You can read all about it in Recode here.
Apparently Lyft also saw self driving cars as the key to the future – but Lyft passed on the deal because they weren’t interested in self driving trucks.
So either way, the ridesharing industry is full speed ahead on driverless cars. I wonder if any of those executives who have been throwing around billions of dollars on driverless car technology have spent much time behind the wheel as a rideshare driver – and whether they truly understand just how many split second judgements drivers make in an effort to get their passenger safely from point A to B.
I also wonder how happy the future passenger is going to be when they are stuck behind a big truck that has blocked the only legal lane available for passage – and they can’t communicate with the technology to let them know they about to miss their flight to Jakarta.
Or what will the driverless car do when the passenger’s destination is down a dirt road where there are no lines painted on the street? All questions that have to be answered either way this trial comes out.
Former Uber CEO steals the show with ‘bro-cabulary’ in trade secrets trial [NBC News]
Sum and Substance: Former Uber CEO Travis Kalanick’s “bro-cabulary” took center stage Wednesday on the third day of Silicon Valley’s most-watched trial.
The Uber founder repeatedly referred to former Google engineer Anthony Levandowski as his “brother from another mother” and described how the duo plotted to “leapfrog” over the competition to lead the race to perfect autonomous vehicles, according to testimony in U.S. District Court on Wednesday.
At issue is whether Levandowski downloaded files related to self-driving car technology and took them to Uber, thereby accelerating development of the ride-sharing company’s autonomous driving operations.
“Burn a village,” Kalanick told Levandowski in a text message on March 1, 2016. Kalanick said he wasn’t quite sure what he meant by that, but the attorney for Google’s self-driving spinoff Waymo — which is suing Uber, claiming theft of trade secrets — said Levandowski clearly knew because he replied: “Yup.”
“I just see this as a race and we need to win. Second place is first loser,” Levandowski wrote in another text message. Levandowski at the time was working on Otto, a self-driving truck start-up that Uber acquired a few months later for $680 million.
“Agreed,” Kalanick replied.
Waymo’s attorney focused on the obsession Kalanick and Levandowski had to win the autonomous driving race, at times drawing on the unique terminology Kalanick used.
Notes from an April 2016 meeting between Kalanick and John Bares, a former director at Uber’s Advanced Technologies Center, were read in court. They were littered with quotes from Kalanick, including: “The golden time is over. It is war time,” and, “Cheat codes. Find them. Use them.” Kalanick acknowledged they sounded like phrases he would use.
When he was later asked to define “cheat codes,” Kalanick said they were “elegant solutions” to problems that haven’t already been thought of.
Uber stands to be dealt a major setback if it loses the trial. Waymo estimated its damages at $1.9 billion.
My Take: This trial is being billed as the biggest tech show in decades. That’s a lot of hype to live up to and it appears TK is (so far) the main attraction. TK has emerged as such a central figure in this entire drama that they’ve even invented a word to describe the way he uses words: “Bro-cabulary”.
That’s a reference to the bro culture that TK instilled at Uber, using phrases like, “brother from another mother” to describe his relationship with Otto CEO and founder, Anthony Levandowski.
What do you think about how quickly this trial wrapped up? Did it surprise you? Let me know in the comments below!
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-John @ RSG