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Uber, Waymo reach surprise $245M settlement in trade secrets case

The jury had already heard testimony from former CEO Travis Kalanick

by Alyssa Newcomb /  / Updated 

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SAN FRANCISCO — Uber and Waymo announced a surprise settlement Friday in a stolen trade-secrets case just days after the high-stakes jury trial began in federal court.

Under terms of the settlement, Uber will give Waymo, Google's self-driving car spinoff, an equity stake worth $245 million; Uber was most recently valued at $72 billion. Waymo, which accused Uber of using its trade secret in its self-driving cars, had been seeking damages of $1.9 billion.

Uber maintained that it has not used any trade secrets from Waymo, but pledged not to use any of Waymo's proprietary information in its hardware or software, according to a statement from Waymo.

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The settlement came after four days of dramatic testimony, with Waymo's attorney showing how the company wooed former Google engineer Anthony Levandowski in the months leading up to Uber's $680 million acquisition of Otto, the self-driving truck company Levandowski founded after leaving Google.

Uber CEO Dara Khosrowshahi, in a statement after the settlement was announced, said that the Otto acquisition should have been handled differently.

"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," he wrote.

Waymo said in a statement that the settlement would protect its "intellectual property now and into the future."

"We have always believed competition should be fueled by innovation in the labs and on the roads, and we look forward to bringing fully self-driving cars to the world," the statement said.

The case drew widespread media attention, as most lawsuits in Silicon Valley are settled behind closed doors. The trial offered a peek behind the curtain of the secretive companies, as well as a look into the life of former Uber CEO Travis Kalanick.

The trial was the first time the public had heard directly from Kalanick since he resigned as Uber CEO last June amid questions about his leadership and as the company dealt with a gender discrimination and harassment scandal.

Waymo's attorney zeroed in on Kalanick's cut-throat obsession in making Uber a leader in building autonomous vehicles and his friendship with Levandowski leading up to when Uber acquired Otto.

"We hired Anthony because we felt that he was an incredibly visionary, a very good technologist - and he was also very charming," Kalanick said.

The duo were so close that Kalanick admitted he had — on several occasions — referred to Levandowski as his "brother from another mother."

Kalanick's unique choice of lingo also provided some colorful moments during his testimony on Tuesday and Wednesday.

When asked about a January 2016 "jam sesh," he had with Levandowski, Kalanick explained that was a term he used for a creative brainstorming session. At that meeting, he wrote: "Laser is the sauce!" on a whiteboard.

Lasers, part of a radar technology called LiDAR, are an essential component of self-driving vehicles. Kalanick acknowledged that Uber didn't have that "sauce" until it acquired Otto later that year.

Levandowski had not yet been called to testify and was not named in the lawsuit. In another text message exchange between the pair, Kalanick told Levandowski in March 2016 to "burn a village."

Kalanick said he wasn't quite sure what he meant by that, but Levandowski apparently knew, Waymo's attorney said, because he replied, "Yup."

Later, he added: "I just see this as a race and we need to win. Second place is first loser."

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