Uber Part 2: Is Levandowski Guilty of Stealing Trade Secrets?

Yesterday, we talked about Waymo’s lawsuit against Uber over the alleged theft of the secrets behind Waymo’s self-driving car technology. What we didn’t get a chance to get into is the criminal consequences for the man who allegedly stole the files in the first place-Anthony Levandowsky.

After years of working with Google and Waymo, Levandowsky allegedly quit with no notice; making off with upwards of 14,000 confidential files relating to Waymo’s self-driving car technology. He immediately started his own self-driving software firm named Otto. Then, mere weeks after Otto came into existence, Uber (in the process of designing its own self-driving technology named Lidar) bought the whole shebang for $680M.

This led to the lawsuit against Uber, which we discussed in a previous article. However, it also might lead to even more serious problems for Levandowski.  When Uber’s attorneys attempted to question Levandowski in an effort to gather evidence for their civil case, he invoked his 5th Amendment right against self-incrimination. Pleading the 5th is asserting your right to not be forced to act as a witness against yourself in a criminal case but can be used to avoid testifying in either a criminal or a civil case so long as the answer to a question would tend to incriminate you. In a criminal trial, pleading the 5th can’t be used by a jury as evidence that somebody is guilty. This is not the case in a civil trial however, the jury is free to make any inferences they like when somebody pleads the right to avoid self-incrimination.

The judge in the case, Judge William Alsup, has certainly taken issue with Mr. Levandowsky’s actions. Taking into account both Levandowsky’s plea and apparently substantial evidence against him Judge Alsup has taken the rare step of reffering Mr. Levandowsky to the US Attorney’s Office for criminal charges.

The US Attorney’s Office may or may not proceed on Judge Alsup’s recommendation. Even if they do, it’s no guarantee that Levandowski will be found guilty-criminal proceedings require a higher standard of evidence. Criminal trade secret law is also similar, but not identical to its civil counterpart. In order to figure out exactly how much trouble Levandowsky is in, let’s take a look at exactly how criminal trade secret charges work as well as when and how the US Attorney’s Office decides to bring charges.

Criminal Trade Secret Law

Trade secret theft is a white collar crime under both state and federal laws. In federal law, the type of law Levandowsky would be facing if charged, it is governed by the Economic Espionage Act of 1996 (EEA)

Under the EEA, it is illegal steal, take without permission, carry away or obtain a trade secret by deception. It is also illegal to copy, download, upload, alter, destroy, transmit, give away, or sell a trade secret without permission. The EEA also makes it a crime to receive, buy, or own a trade secret that you know was wrongly obtained. A trade secret is defined as information that is made more valuable by being secret where its owner has taken reasonable steps to make sure the information stays secret.

For those of you who have read the article describing Waymo’s lawsuit against Uber earlier this week, these elements will sound quite familiar. However, there are a few differences between the criminal and civil sides of trade secret. First, the EEA makes it a crime to attempt or conspire to commit trade secret theft. At civil law this is not the case. As mentioned above, the standard of evidence is substantially different. Civil law requires a preponderance of the evidence-fifty percently likelihood plus a feather-criminal requires proof beyond a reasonable doubt. However, the single most substantial difference between civil and criminal trade secret is that criminal trade secret always requires evidence of intent and knowledge-the intent to “convert a trade secret” and knowledge that the person was committing one of the acts that are illegal under the EEA. Evidence of an intent to covert means that it must be shown that a person acted with the intention of exerting control over somebody else’s property which is not authorized by the property’s owner.

The evidence from the Waymo case makes it seem pretty cut and dried that Levandowski, at a minimum, took the 14,000 confidential documents without permission. His employment agreement made it fairly clear that they were not his to take. This means a criminal case against him would likely hinge on intent and knowledge. For somebody Levandowski, this would likely require proof that, at the specific time he committed a crime under the EEA, he did so with the intent to either use them himself or share the secrets contained within the documents he downloaded. The evidence certainly points this way. Especially damning is alleged evidence of plans to sell Otto to Uber from before Levandowski even left Waymo. Knowledge would require evidence that Levandowsky knew he was not supposed to take the documents he did. As mentioned already, we know this is the case because his employment agreement clearly forbade him to take and share those documents.

Will Criminal Charges Be Brought?

You can see that there’s a pretty strong potential case here against Levandowski. It’s worth noting that it is by no means ironclad. Levandowsky certainly had access to the files, partially because of his position. However, how easily accessed those files are might impact whether Waymo took sufficient measures to protect their trade secrets. The issue of intent may also be muddied somewhat by the exact level of access to the files Levandowsky was allowed in his position. If he actually believed he was allowed to take the files then he would not have the necessary intent for a criminal conviction.

All of this will be taken into account when the US Attorney’s Office decides whether to prosecute the case. Due to how overextended the budget of the Attorney’s Office is, criminal charges under the EEA are moderately rare. They often come up in situations where the secrets are owned by the government and/or are taken by international agents-a situation that the EEA slaps with higher penalties. For instance, the very first (and potentially most famous) EEA trade secret case involved a Chinese national who stole trade secrets related to the US Space Shuttle Program from Boeing.

Levandowsky is certainly not on this level. However, he would be far from the first homegrown conviction. Nor would he be the first criminal conviction that didn’t deal with earth-shatteringly important secrets-space shuttles, military software, and the like. In fact, the US Attorney’s Office has a published policy for how it decides whether it should prosecute a violation under the EEA. This policy looks at a number of factors including : 1) how wide the scope of the criminal activity is and especially whether a foreign government is involved; 2) how bad the economic injuries are to whoever owns the trade secret; 3) what type of trade secret was stolen (military secrets are obviously way up there on the priority list); 4) how effective a civil remedy would be; and 5) the potential deterrent value of bringing criminal charges-how much it will scare off similar criminals.  The existence of a civil remedy doesn’t weigh that much against prosecution as that remedy will almost always exist.

Levandowsky, if guilty, has immeasurably damage Waymo in their quest to be first to market in the burgeoning self-driving technology field. However, his single act of theft from a private company who is already suing in civil court might just be too small fry for the US Attorney’s Office to bother with.

What Does Levandowsky Potentially Face?

We’ll have to see if the US Attorney’s Office chooses to pursue a case against Mr. Levandowski. It’s unlikely Judge Alsup would have recommended charges if the case against Levandowski was not particularly strong. If they do chose to come after him, he’ll be facing up half a million in fines and a decade in prison.

Even with just the civil case leveled against him, Levandowski is in hot water. Criminal charges would take that water to boiling. However, even if the US Attorney’s Office does bring charges they are unlikely to do so particularly soon. For now, Levandowsky will just have to stew and hope.