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By Greg Bensinger 

This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (February 6, 2018).

SAN FRANCISCO -- Silicon Valley's biggest legal battle in years began on Monday as lawyers from Alphabet Inc.'s Waymo and Uber Technologies Inc. traded barbs in a federal case that could have significant implications for the race to bring robot cars to the streets.

During opening remarks in front of a 10-person jury sitting less than a mile from Uber headquarters, Waymo's lawyers portrayed Uber's former chief executive, Travis Kalanick, as a cheater who would do anything to catch up to his competitor.

Uber's attorneys pushed back in their defense, calling Waymo's portrayal "quite a story" while denying the allegations that Uber swiped trade secrets and knowingly used them to develop autonomous vehicles. An Uber attorney, Bill Carmody of Susman Godfrey LLP, said there was no conspiracy or cheating. "Period, end of story."

The high-stakes showdown pits an offshoot of Google against a highflying startup in Uber, two companies estimated to be worth tens of billions of dollars and among the leaders in autonomous-vehicle development. The case could test intellectual property law in Silicon Valley, where top engineers with technical chops are constantly being poached by rival companies.

Waymo sued Uber nearly a year ago in the U.S. District Court for the Northern District of California, saying the startup ransacked the tech giant's design secrets after paying about $680 million in 2016 to buy autonomous-truck company Otto, founded by a former star engineer at Google, Anthony Levandowski. Uber has denied the allegations.

Waymo will seek an injunction to prevent Uber from developing further aspects of its driverless-car technology and possible damages that could reach into the billions. Both companies are vying for a stake in the auto industry, which claims some $2 trillion in annual revenue, according to Deloitte Consulting.

Waymo's lawyer, in his opening remarks, pointed to Mr. Kalanick for allegedly conspiring to have Mr. Levandowski bring his files and know-how from years of developing the technology at Google. He said Uber tried to cover its tracks through clandestine meetings and erasing emails and text messages.

Uber needed "to win at all costs and losing is not an option -- they would do anything they needed to do to win, no matter what," said Charles Verhoeven, the lawyer representing Waymo from Quinn Emanuel Urquhart & Sullivan LLP. Mr. Kalanick "made a decision that winning was more important than obeying the law; he decided to cheat."

A spokesman for Mr. Kalanick declined to comment Monday. An attorney for Mr. Levandowski declined to comment. Mr. Kalanick has denied any theft in depositions, and Mr. Levandowski has previously indicated he will invoke his Fifth Amendment right against self-incrimination.

The case hinges on a technology known as lidar, or light detection and ranging systems, which is used to guide self-driving vehicles. Waymo will seek to persuade the San Francisco jury to put a stop to Uber's development of lidar based on what it says is its proprietary technology.

Mr. Verhoeven presented evidence including steps Mr. Levandowski took to download thousands of Google files to his personal computer.

Uber's attorney, Mr. Carmody, called the downloaded files unimportant, adding that Uber never received or used any proprietary information. He said engineering talent is essential in developing self-driving car technology, which drove Uber's acquisition of Otto and its employment of Mr. Levandowski.

Both sides sought to cast Mr. Levandowski, who is not a named defendant, as a bad actor. "We can't trust this guy," said John Krafcik, CEO of Waymo and the first to testify in the case. "I had grave doubts" about his honesty, he said.

Mr. Carmody, for Uber, said in his opening remarks that even while he worked at Google, executives knew Mr. Levandowski couldn't be trusted. He showed an email to the jury in which a Google executive wrote to another that he would never want Mr. Levandowski as a business partner.

Waymo has sued because it wanted to prevent Uber from getting its top engineers, argued Mr. Carmody. "It's all about Google worrying about their talent, their engineers leaving," he said.

Mr. Carmody worked to paint a picture of panic within Waymo over the loss of several high-level executives, including Mr. Levandowski, pointing to emails and planning documents where Mr. Krafcik and others discussed the departures. Those comments suggest Uber is planning to portray Mr. Levandowski as a scapegoat that Waymo used to prevent further employee attrition.

Judge William Alsup has challenged Waymo attorneys to prove not just that Uber arranged for the trade secrets to be stolen, but also that it used them inappropriately in its development of lidar. That may mean convincing the jury of technical subtleties in software code and sensors.

Uber fired Mr. Levandowski last May after he missed a court-ordered deadline to produce documents related to the lawsuit. The company was aware Mr. Levandowski took the trade secrets but has argued it never used them in its development of lidar or other self-driving car technology.

Write to Greg Bensinger at greg.bensinger@wsj.com

(END) Dow Jones Newswires

February 06, 2018 02:47 ET (07:47 GMT)

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