Disappointing To See Google's Waymo Sue Over Patents

from the get-the-market-right dept

Mon, Feb 27th 2017 2:56pm — Mike Masnick

For years, we had pointed out that one of the nice things about the new generation of tech companies was that they rarely seemed to use patents offensively. Yes, they were subject to tons of patent lawsuits from trolls or from legacy players trying to hang on against innovators, but we've pointed out in the past that young companies innovate, while older companies litigate. So, we have a tendency to watch companies to see when they shift from being patent litigation defenders, to going on the offensive. For years -- even as patent system supporters falsely claimed that Google only existed because of patents -- it was good to see not a single example of Google going on the offensive and filing patent lawsuits against other companies.

That changed, unfortunately, back in 2012 when Google brought a patent lawsuit against Apple. Some argued that it wasn't "really" Google, because it came from Motorola, a company that Google had purchased (mainly for the patents) and then only owned for a short while before dumping, but it was still a Google-owned property going on the offensive. At that time, we argued that if Google really wanted to support patent reform (as the company claimed) then it should stop being a patent aggressor.

To its credit, I don't believe the company went on the offensive again... until just now. As has been widely reported, Google's Waymo subsidiary (which works on Google's self-driving cars) has sued Uber over its self-driving car technology, which Uber obtained last year, in purchasing another startup, Otto, for its self-driving car technology. Otto, of course, was founded by a former Google/Waymo guy. Just a few weeks ago, Bloomberg had written that a bunch of early Google car team members had left to found Otto in part because Google had paid them a ridiculous sum of money, so they no longer needed to stay there.

Along with the lawsuit, both in the filing itself and in a separate blog post about the lawsuit, Waymo tries to bend over backwards to say that this situation is not your typical "patent" lawsuit, but a very specific one. Indeed, the company is clear that the patent issue is a lesser concern. The larger one is over trade secrets -- and here the company is fairly specific that Otto's founder, and several early employees, appear to have deliberately copied a huge amount of proprietary info from Google/Waymo before departing:

Recently, we received an unexpected email. One of our suppliers specializing in LiDAR components sent us an attachment (apparently inadvertently) of machine drawings of what was purported to be Uber’s LiDAR circuit board — except its design bore a striking resemblance to Waymo’s unique LiDAR design.

We found that six weeks before his resignation this former employee, Anthony Levandowski, downloaded over 14,000 highly confidential and proprietary design files for Waymo’s various hardware systems, including designs of Waymo’s LiDAR and circuit board. To gain access to Waymo’s design server, Mr. Levandowski searched for and installed specialized software onto his company-issued laptop. Once inside, he downloaded 9.7 GB of Waymo’s highly confidential files and trade secrets, including blueprints, design files and testing documentation. Then he connected an external drive to the laptop. Mr. Levandowski then wiped and reformatted the laptop in an attempt to erase forensic fingerprints.

Beyond Mr. Levandowki’s actions, we discovered that other former Waymo employees, now at Otto and Uber, downloaded additional highly confidential information pertaining to our custom-built LiDAR including supplier lists, manufacturing details and statements of work with highly technical information.

If accurate, that does sound fairly deliberate and sneaky. And you can certainly understand why the company is upset. The main focus of the lawsuit is the trade secrets claim. But the lawsuit also makes claims for patent infringement on three separate patents as well.

Again, you can understand why this situation would be frustrating for Waymo/Google. And maybe the direct evidence of downloading all that material prior to leaving Google is a legitimate reason to file a lawsuit. But it still seems problematic. When Elon Musk freed up all of Tesla's patents, he made it quite clear the reason he was doing so was that this was a brand new, emerging market, and it was going to need all the help it could get in becoming established. And that meant lots of companies competing and innovating and together educating the market. Thus, it didn't really matter if new entrants copied Tesla's electric car/battery technology, because in the end it would help create a larger market that helped everyone.

That same situation is true for self-driving cars as well. Even given the presence of the potential smoking gun of the downloads of documents, there's still something to the idea that the market would be a lot better off if everyone were just building the best possible self-driving car tech they could find, even if that means copying one another. Fighting over trade secrets and patents in a market that barely even exists feels silly. Yes, from a purely profit maximizing standpoint, you can understand the argument: the larger share of the market you can capture early can make a huge difference. But why not focus on executing in the marketplace and fighting the battles that are blocking the adoption of self-driving cars, rather than fighting back and forth with each other.

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Filed Under: autonomous vehicles, patents, self-driving cars
Companies: google, uber, waymo

80 Comments

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John, 27 Feb 2017 @ 3:36pm

Patents are different to data
Handing over patents which is just ideas is a lot different to copying all the research data from years of testing those ideas. As has been mentioned many times on this site, it is the execution of the idea that is significantly more important and difficult than just the idea alone. IF the data from tests were taken that would be a big step up for a competitor and I think google is right in trying to stop a competing product from using that data. Yes having more companies in the market is good for competition but only if its their own product/ideas/test data and not just a copy of a competitor. I'm surprised that it has taken so long to file the law suit.
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Syed Rahman, 27 Feb 2017 @ 3:37pm

I would like to agree but..
This is stealing not patent trolling. This does not seem like it is Googlegetting angry then suing someone into bankruptcy. It sounds like Google found out collusion and reported it. Employees should not be disgruntled and just hand over information. Otherwise, people might just be "right" about their wrong assumptions about Snowden selling chinese our KFC sauce recipe.
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Anonymous Coward, 27 Feb 2017 @ 3:52pm

Yes, if the accusations are correct, it is theft. And Google owes it to its stockholders / investors to attempt to recover that loss, which might be worth many billions in market share.
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Anonymous Coward, 27 Feb 2017 @ 4:11pm

Wow, the hypocrisy. Mike thinks it's a bad thing that artists get to charge royalties and get paid again and again for work they did years ago, but he's perfectly OK with these engineers performing a work for hire, being compensated HANDSOMELY (by all accounts) for their work, then taking the product of that work to start a competing company so they can get paid again and again for that same work. They are all but literally biting the hand that fed them and Mike thinks this is OK? Mike, I think your moral compass needs a slight adjustment.
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Mike Masnick (profile), 27 Feb 2017 @ 4:26pm

Re:

Wow, the hypocrisy.

Huh? Where?

Mike thinks it's a bad thing that artists get to charge royalties and get paid again and again for work they did years ago, but he's perfectly OK with these engineers performing a work for hire, being compensated HANDSOMELY (by all accounts) for their work, then taking the product of that work to start a competing company so they can get paid again and again for that same work.

Huh? Where did I say any of that? You seem to be projecting multiple things on me, nearly all of it wrong.

They are all but literally biting the hand that fed them and Mike thinks this is OK?

How so?

Mike, I think your moral compass needs a slight adjustment.

This is entirely possible, but not from what you wrote which makes no sense.

I don't necessarily think it's a bad thing that artists can charge royalties. If they can, good for them. My concern is when that's used to stifle creativity and innovation. What I want is more innovation and more creativity. And letting people build different implementations of the same or similar ideas would do that.

My stance is consistent. Whether or not it meets your moral compass is a different issue altogether.
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Mike Masnick (profile), 27 Feb 2017 @ 4:28pm

Re: Patents are different to data

Handing over patents which is just ideas is a lot different to copying all the research data from years of testing those ideas. As has been mentioned many times on this site, it is the execution of the idea that is significantly more important and difficult than just the idea alone. IF the data from tests were taken that would be a big step up for a competitor and I think google is right in trying to stop a competing product from using that data.

Why? I'm sincerely curious as to why this is a bad thing? They still have to execute, even if they have the data.

I'm surprised that it has taken so long to file the law suit.

As seems to be pretty clearly laid out in the post, Waymo only just found out about all of this.
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Mike Masnick (profile), 27 Feb 2017 @ 4:30pm

Re: I would like to agree but..

This is stealing not patent trolling.

I didn't say it was patent trolling. But it's also not "stealing." All of the information is still retained by Waymo. What was lost?

This does not seem like it is Googlegetting angry then suing someone into bankruptcy.

Yes. But we didn't say it was either.

It sounds like Google found out collusion and reported it.

What?

Employees should not be disgruntled and just hand over information. Otherwise, people might just be "right" about their wrong assumptions about Snowden selling chinese our KFC sauce recipe.

Wut?
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Anonymous Coward, 27 Feb 2017 @ 4:31pm

It's one thing to take a concept from another company and essentially recreate it on your own, likely adding in a bit of innovation yourself.

It's another thing to straight up take proprietary information and walk out the door with it.
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Mike Masnick (profile), 27 Feb 2017 @ 4:31pm

Re:

Yes, if the accusations are correct, it is theft. And Google owes it to its stockholders / investors to attempt to recover that loss, which might be worth many billions in market share.

If it was theft, what was lost? And, sure, it might be worth a lot in marketshare, but also, Uber helping to drive more development and competition in the market could increase the size of the overall market, meaning even greater value for Waymo in the long run. Who's to say which would most likely happen? It's not as cut and dried as you claim.
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Atkray (profile), 27 Feb 2017 @ 5:05pm

Corporate espionage &/or CFAA
"We found that six weeks before his resignation this former employee, Anthony Levandowski, downloaded over 14,000 highly confidential and proprietary design files for Waymo’s various hardware systems, including designs of Waymo’s LiDAR and circuit board. To gain access to Waymo’s design server, Mr. Levandowski searched for and installed specialized software onto his company-issued laptop. Once inside, he downloaded 9.7 GB of Waymo’s highly confidential files and trade secrets, including blueprints, design files and testing documentation. Then he connected an external drive to the laptop. Mr. Levandowski then wiped and reformatted the laptop in an attempt to erase forensic fingerprints."

How is this not plain old fashioned corporate espionage with a side order of CFAA violations?

Based on past behavior the DOJ should be threatening Levandowski with hundreds of charges and 200+ years in prison.

Oh wait, the damage was to Google and not a copyright maxamialist.
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Anonymous Coward, 27 Feb 2017 @ 5:23pm

Charge stacking?
Are Google/Waymo just trying to stack on the charges and see what sticks? Patents are being involved in case leaking trade secrets falls through? Is it a revenge thing to hit as hard as possible?
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David Collado, 27 Feb 2017 @ 5:30pm

Not so fast
Let me preface this by saying I generally agree with almost everything you write here about patents. I can honestly say I became a patent attorney based largely on Techdirt's coverage of patent trolling over the years which pissed me off enough to want to go fight it (I've since pivoted and now work as a software developer).

With that said, I believe your market comparison/analysis between what Musk did and what you think Google should do is off. Tesla's market for electric vehicles is B2C (with some B2B). Google's market for self-driving cars is exclusively B2B and will remain so for the foreseeable future due to regulatory barriers. That is not a subtle difference, especially considering the number of Bs in the market for self-driving car fleets is relatively tiny. This means Google has orders of magnitude fewer potential customers to market to compared to Tesla. So while both markets are still young and growing, the sales cycle and prospects are very different.

In other words, the cost of losing a customer to the competition in the self-driving car market is much much larger than the cost of losing a customer in the electric vehicle market (fleets vs. individual, commercial vs. consumer, long-sales-cycle vs. short-sales-cycle).

To be clear, I'm not suggesting anything here regarding the merits or prudence of Google's legal action. I'm just pointing out the fact that it's not a fair comparison to say that Google should follow Tesla's lead on IP because they play in similar markets.
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Mike Masnick (profile), 27 Feb 2017 @ 5:32pm

Re: Corporate espionage &/or CFAA

How is this not plain old fashioned corporate espionage with a side order of CFAA violations?

Doubtful that it's a CFAA violation. That requires it to be unauthorized access or exceeding authorized access. From all reports, Levandowski had authorized access to those machines at the time of the downloading.
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Anonymous Coward, 27 Feb 2017 @ 5:49pm

Re:
That's something Samesung does all the time and gets away with it. You have to be completely blind not to see it. It's not just flat out copying Apple either as they've done it to a number of company's. By the time it's run it's course though years of court. No one seems to care.
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amoshias (profile), 27 Feb 2017 @ 5:53pm

Yeah, I don't get your point here, Mike.
Because it kind of seems like you're saying that patents shouldn't exist at all.

I'm hardly a patent maximalist; I agree with the point of view that says the vast number of patents I see should not exist. But some clearly should, because actual invention should be rewarded. We want more of it, and patents are one possible way to encourage it. (And some smart people recognize that their patent will make them more money if they don't exercise it than if they do.)

But it seems like you're making an analogy between copying a song or TV show - IE a widely distributed piece of art - and copying an unpublished, literally secret invention a company hasn't yet released. I *AGREE* with the "well, what have you lost?" argument when it comes to copying the song. But in this case, the "what have you lost?" argument is so blindingly obvious - the first mover advantage is enormous and this is a cutting-edge tech field - that it seems weird to me that you're falling back on "But it's also not "stealing." All of the information is still retained by Waymo." that it seems to me like all you're doing is falling back on semantics about the word stealing. Yes, you're absolutely correct, that no unique physical object was removed from Waymo's premises. But in the great scope of things, this is much closer to the traditional definition of "stealing" than what we, you, me, and our community, generally object to when the RIAA and MPAA call downloading a movie theft.

I know you get accused of shilling for companies a lot... from my point of view, that's clearly not true. But you do demonstrate this weird, WEIRD love for Uber that makes you overlook a ton of the crappy things they do. Like buying stolen plans from Google to bootstrap their own effort. This is literally the heartland of what intellectual property and trade secret protections exist for. The reasons those laws exist is because they're EFFICIENT - it is SO much better to protect trade secrets with laws than through the level of complete security paranoia you'd need if you knew a rival could just swipe the plans to what you're working on with no repercussions. And I feel like you spend so much more time than me thinking about this stuff, and the position you're taking is so weird - and just doesn't seem well-supported from someone who can almost ALWAYS support his points, even when I disagree with them.

So I'm just going to call it your Uber-blindness, and then call it a day. But I really, really think you need to rethink your point - or at least rewrite the article so it comes across better.

Or just stop writing articles about anything to do with Uber, they rarely come across as your best.
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Anonymous Coward, 27 Feb 2017 @ 5:57pm

Abolish Patents
Problem solved.
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Anonymous Coward, 27 Feb 2017 @ 6:05pm

EFFICIENT

The reasons those laws exist is because they're EFFICIENT

"Efficiency" has been used as an excuse for all kinds bad behavior.
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Anonymous Coward, 27 Feb 2017 @ 7:01pm

Re: Re: Patents are different to data
They still have to execute but with test data, and not just information from patent filings, a competitor can save a ton of money.

In regards to your comparison with Tesla: Tesla is "giving out" their patents and not the "test data".
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Anonymous Coward, 27 Feb 2017 @ 8:30pm

Heros
It appears that Mike's hero, Google, has disappointed him.
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Mike Masnick (profile), 27 Feb 2017 @ 9:18pm

Re: Yeah, I don't get your point here, Mike.

I know you get accused of shilling for companies a lot... from my point of view, that's clearly not true. But you do demonstrate this weird, WEIRD love for Uber that makes you overlook a ton of the crappy things they do.

This is funny to me. As far as I know, the only company that people accuse me of "shilling" for (falsely) is Google. Yet, in this very post I'm criticizing Google (and everyone's disagreeing with me...) and now I'm being told that it sounds like I'm shilling for Uber.

I can't win.
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Anonymous Coward, 27 Feb 2017 @ 9:29pm

Re: Socialist Mike
OK, Socialist Mike, why don't you lay out your vision for your socialist society full of creativity and innovation, with no protection for intellectual property of any sort. While you're doing that, why don't you get the fuck out of the USA, since you can't seem to accept or respect our constitution or our laws. Oh, and I wouldn't suggest Thailand as a destination (for any of you). I don' t think you would ever make it through immigration control.
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Anonymous Coward, 27 Feb 2017 @ 9:50pm

I think you're getting more pushback than usual on this in part because of the egregious nature of the alleged corporate espionage, and because you did not go into the specifics of the patent aspects of the suit, so they are easily conflated with the rest of the insidious data copying.

I do agree that most patents fail to serve inventors or society, and that free information can help both the people and businesses. I share your admiration for Elon Musk's move. However, in his case he shared patents in a market he was already established and producing products, and having dominant name/brand recognition. That feels a bit different from cheating to take the initiative out from under another pre-entrant. The example in the article seems instead like having a nasty classmate secretly copy your test answers. That cheater may even get special recognition if the grader see's their test first, or if their lack of erased and crossed out dead ends (that your hard-won answers have) makes their version look cleaner/neater/smarter. One could argue that you should be happy to have raised the class' average score via your copycat, but I don't viscerally feel this.

Information wants to be free, but cheaters are cheaters.
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Anonymous Coward, 28 Feb 2017 @ 12:03am

Re: Re:
So let me see if I fully understand your viewpoint...

Let us say I am your paid assistant. It isn't theft if, before I quit, I copy almost-complete drafts of your next few articles. In fact, it might be a good thing, because if I publish these articles with my own personal touches, potentially before you do, then more people are reading your ideas, thus increasing the size of the potential Techdirt audience.

...

What? This doesn't make that much sense to me. If this is how you truly feel, perhaps you should reconsider letting any hirelings touch your intellectual property.
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@b, 28 Feb 2017 @ 12:25am

Being employed by a corporation 101
There is no chance Google employees are allowed to take a copy of interval documents when they resign.

Does anybody here have access to a Google employment contact to check the wording?

You simply cannot send a copy of a internal documents out of the corporation. That is the whole point of being on the official payroll and then being taken off it.

Being given access to make copies has zero to do with it.

Google should have an easy time fighting this on breach of contact grounds (non disclosure, binding agreement, your signature here, yadda yadda yadda).

'Til death do you part.

Amen.
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Anonymous Coward, 28 Feb 2017 @ 12:36am

young companies innovate, while older companies litigate
Spare me the crap of young companies vs old companies, please.

I'm old enough to remember that a young bookshop got a patent on the use of a cookie: one-click shopping. The internet fell over them, telling them that the patent was bad. The shop promised to use it only defensively. They did, until Barnes and Noble opened a bookshop too.

Then, Amazon felt it needed to defend itself by going offensive with the patent.
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Mike Masnick (profile), 28 Feb 2017 @ 12:48am

Re: Re: Socialist Mike

OK, Socialist Mike, why don't you lay out your vision for your socialist society full of creativity and innovation, with no protection for intellectual property of any sort.

Wut? Where did I say any of that? And "socialist"? Huh?

While you're doing that, why don't you get the fuck out of the USA, since you can't seem to accept or respect our constitution or our laws.

I respect our laws and the Constitution quite a bit. You must be new around here. Or, very, very confused.
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Mike Masnick (profile), 28 Feb 2017 @ 12:50am

Re: Not so fast

With that said, I believe your market comparison/analysis between what Musk did and what you think Google should do is off. Tesla's market for electric vehicles is B2C (with some B2B). Google's market for self-driving cars is exclusively B2B and will remain so for the foreseeable future due to regulatory barriers. That is not a subtle difference, especially considering the number of Bs in the market for self-driving car fleets is relatively tiny. This means Google has orders of magnitude fewer potential customers to market to compared to Tesla. So while both markets are still young and growing, the sales cycle and prospects are very different.

Good point and a fair criticism of the post. I'm still not convinced that it makes that big of a difference, but it is (likely) a different type of market and that certainly could have an impact.
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Mike Masnick (profile), 28 Feb 2017 @ 12:55am

Re: Re: Re:

Let us say I am your paid assistant. It isn't theft if, before I quit, I copy almost-complete drafts of your next few articles. In fact, it might be a good thing, because if I publish these articles with my own personal touches, potentially before you do, then more people are reading your ideas, thus increasing the size of the potential Techdirt audience.

Hmm. Well, we do place all our work in the public domain, so we don't mind when anyone takes it and does whatever they want with it for the very reasons you describe: it means more people are reading those ideas.

But, as for the very specific situation you describe, that's an interesting, but unrealistic hypothetical for a variety of reasons. To start off: nearly all my work is reviewed prior to publication by people who work for me and in nearly 20 years, no one's ever done what you claimed. So the reality is that there's basically zero risk of your scenario actually happening.

Second, if someone did that, I certainly wouldn't sue them. But it's possible, depending on the circumstances, the person might be fired. But that's a different issue. If someone were doing it to deliberately undermine stuff that we were doing, that's a fireable offense. If someone did it by accident, I don't think that's worth firing someone over. It depends on the details.

But, really, what I'm trying to figure out is why someone who works here for me would ever want to do that? It makes no sense. But, if they did, it wouldn't be theft. It might be a bad thing that could be fireable, but we'd move on.

Either way, the situation is entirely different from what happened in this lawsuit. Your analogy doesn't hold much water.
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Mike Masnick (profile), 28 Feb 2017 @ 12:58am

Re:

I think you're getting more pushback than usual on this in part because of the egregious nature of the alleged corporate espionage, and because you did not go into the specifics of the patent aspects of the suit, so they are easily conflated with the rest of the insidious data copying.

Fair enough. I did note that the trade secret claims do seem fairly egregious, and I can understand why there would be anger over that (which is what I sense many in the comments are getting at). But the gist of my post mixes the trade secrets and the patent issues together, because I'm trying to figure out if the difference in impact between the two is really all that different. And I'm having difficulty coming up with a convincing argument for why this is really that bad in the end? Annoying for Google? Absolutely. But it's still such an early market that I think hoarding information on making products like this work seems unnecessary.
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My_Name_Here, 28 Feb 2017 @ 1:53am

Great Story
This is a great story, in no small part because it is a pretty obvious one, and one that clearly has you all mixed up!

I think it's a pretty straight forward deal. Google has certain patents. The employee copied data related to those patents, and took it with him to the new company. The value of that data is very much in the patents themselves, the data shows real world tests of those patents in action, and could save the new company a ton of time in the development of their product. It's violating a patent on steroids, if you were, not only getting the idea (as patent) but also getting applicable data on how it works and how to use it in the real world.

Google / Waymo is absolutely right to go after this guy in the biggest way possible, and the company as well. It's an insane violation of company proprietary information as well as patent infringement. You could almost call it criminal (and I think maybe they should).

As for comparing Google / Waymo to Tesla in regard to patents, just remember that the real reasons Tesla put the patents out there was in a hope to create the standards for the industry. By giving many others a short cut to success by connecting the dots and doing things the Tesla way, they hoped to be market leaders.

This is particularly important when it comes to things like charging stations. Having a charging method that is common to more cars makes it easier for companies to choose to have charging stations. Tesla as a company know that they are only as good as the network of places to charge the car. So releasing patents and trying to be the standard is good for their business. It has nothing to do with kindness of their hearts or anything like that. It's all about domination. Elon Musk is no dummy!
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Anonymous Coward, 28 Feb 2017 @ 2:03am

Re: Re: Re:
Was this a case of an assistant stealing others Ideas, or the people who did the work taking it with them. In other words who has the best claim to

One of the ways that companies stand in the way of progress is by aggressively asserting rights to the works and ideas of employees, and using that to stop them from following up their ideas elsewhere. the work, the company or the people who produced it?
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Anonymous Coward, 28 Feb 2017 @ 2:12am

Re: Re: Re: Re:
At the risk of breaking my own rule about never engaging with an idiot, let's see if I can give you a better example. Let's say that your staff becomes concerned that you have painted yourself into a corner by inviting lawsuits and supporting frauds. And let's say that they have access to your customer lists, your history of pricing and sales, and the unmet needs of your customers. So, imagine that they just took these records (which they actually might do) and set out to compete with TechDirt, without any of the historical baggage that TechDirt brings with it, and without having to make any investment at all, instead relying on your hard work and perseverance over the years to pinpoint the best opportunities. And then you were left with no customers, no "friends" to help you, and an endless lawsuit, while your former employees created a big hit based on information they stole from you. You know, this sounds so plausible that I might even finance it, and you already said you would never sue. :)
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Mason Wheeler (profile), 28 Feb 2017 @ 2:53am

Re: Re: Yeah, I don't get your point here, Mike.
I think part of it is perception. Google provides a valuable public service, whereas Uber seems to be engaged in a full-out sprint lately to see how fast they can reach, and then surpass, Comcast levels of corporate evil in the public eye. When you go supporting them over Google in a straight-up corporate espionage case in which (assuming the allegations are correct of course) they are clearly in the wrong, just because something something patents something something, it looks really bad.
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Jack Smith, 28 Feb 2017 @ 4:01am

It is NOT patents!
This article is so poorly written riddled with inaccurate information.

Gets off to a horrible start with the title. This is NOT about patents!

Google only sued once and that was Moto where it started before they purchased.

Google has created cross license agreements like crazy. They have them with Cisco, SAP, Verizon, Samsung, and even MS and a limited one with Apple.

Google often times bringing in others even small players.

But sometimes enough is enough. This is so incredibly patent theft they really could not let it go.
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Anonymous Coward, 28 Feb 2017 @ 4:42am

Re: Re: Re: Re: Re:
Shiva? Is that you?

...Great, now you made me break my own rule about never engaging with an idiot.
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The Wanderer (profile), 28 Feb 2017 @ 5:20am

Why protect trade secrets by law?
This article brings to mind something that I've never understood.

I understand the rationales for granting legal protection to (and, for that matter, creating) copyrights, patents, and trademarks. I may not agree with the ways those things have taken shape in real-world practice, but the underlying reasons and reasoning seem sound.

But why do we grant legal protection to trade secrets?

Trade secrets are the problem which patents were invented to fix. Once we have patents, what public benefit is there to having a penalty under the law for exposing trade secrets, or otherwise using those secrets without permission?

I certainly understand why a company would want to keep something secret - but that doesn't mean that it's in the best interest of the public to support the company's ability to do so; in fact, part of the rationale underlying the creation of the patent system was specifically to discourage companies from doing this.

Why are we both discouraging companies from keeping things secret, by way of the patent system, and encouraging them to do so, by providing legal protections for trade secrets?

I've looked for answers to this before, but all I've managed to find online is articles about how to obtain legal protection for (my) trade secrets; I haven't found one single piece discussing why trade secrets should be protected under the law.
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Anonymous Coward, 28 Feb 2017 @ 5:36am

Copying != Innovation
Originally patents existed to give inventors exclusive rights to their invention while sharing their invention with everyone to promote more inventing.

Here we have an example of that where Google invented and shared the idea.
Along comes another company who literally copied Google's invention and sells it as their own.

Had the ex Googlers independently recreated something similar I'd be inclined to agree that Google should not be suing over patents but the situation here is they copied not invented.

On your point about execution, if both companies become equally successful because both execute well it seems wrong/unfair that one did so by building on a foundation of literally copying the others invention.
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Anonymous Coward, 28 Feb 2017 @ 5:39am

Re: Re: Corporate espionage &/or CFAA
>To gain access to Waymo’s design server, Mr. Levandowski searched for and installed specialized software onto his company-issued laptop.

This makes it sound like his accessing of the Waymo server was unauthorized, and actually textbook corporate espionage and a clear violation of the CFAA. Mike I'm usually with you on IP cases, but this is the exact reason these laws exist in the first place. If these allegations are true then throw the book at them this is a disgusting practice and they deserve to get shutdown.
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amoshias (profile), 28 Feb 2017 @ 6:43am

Re: Re: Yeah, I don't get your point here, Mike.
You certainly can win, and I didn't say it sounds like you're shilling for Uber. It sounds like you clearly appreciate Uber for their impressive, industry disrupting technology, and it seems - based on my perception and that of others in this thread - that causes you to turn something of a blind eye to the incredibly unsavory things the corporate side of the company does. You could, when you write about Uber, consider whether your viewpoint is well supported and if you're letting your biases trump other concerns.

It has to be at least a LITTLE bit of a red flag to you that you've responded so many times in this comment thread. And some of the comments are the typical Techdirt-bashing that comes up in every thread, but I think there are a lot coming from the same angle as me - people who appreciate the hell out of what you do and who feel your position in this particular piece is really weird.

You talk a lot about companies respecting their audiences and their communities. I think this is one time you should seriously listen to what we are saying.
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amoshias (profile), 28 Feb 2017 @ 7:00am

Re: Why protect trade secrets by law?
I alluded to this in an earlier comment - we let trade secrets be protected by law basically simple efficiency. This kind of thing happens rarely; the security required to stop it would be expensive and intrusive. Rather than ten thousand companies locking their documents in safes and searching their employees twice a day, we solve the problem by making this kind of almost-theft illegal.

If it were legal, I could break into Google's labs, photocopy all their documents, sell them to Uber for fifty million (five hundred in this case) and do six months for breaking and entering if I got caught. That encourages corporate espionage. Heck, I'll take that deal.

I think the reason it becomes a confusing area of law is because a lot of companies misuse or, by claiming things are trade secrets which are not.
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Anonymous Coward, 28 Feb 2017 @ 7:19am

Re: It is NOT patents!
From the recode article,

"Waymo is suing and seeking damages from Otto and its owner, Uber, for allegedly stealing trade secrets, unfair competition and patent infringement."

So, you're accusing Johana Bhuiyan at recode of lying? Or maybe you're accusing the United States District Court of distributing a "fake" filing that includes "PATENT INFRINGEMENT"? Or maybe you're just a liar?
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Dingledore the Mildly Uncomfortable When Seated, 28 Feb 2017 @ 7:27am

I don't quite understand this...
If Google already has patents that cover the material in question, then Otto would be freely able to see them, and licence them if they want to use them. What charge Google should claim for using the info is debatable, but that's how it works.

If Google doesn't already have patents that fully cover the detail of what they've already produced, then they face the massive risk of Otto obtaining their own patents and forcing Google to purchase a licence for their own work.

If I were Google, I would certainly consider suing for the sheer arsehattery of it all; for one thing there should be consideration over whether Otto got their contracts with Uber because of this data. I'd also (if I were Google) be considering releasing all the documents into the PD so that any potential advantage gained by Otto/Uber over smaller developers is minimised.
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Paul, 28 Feb 2017 @ 7:29am

Re: Re:
The entire case is over theft and breach of contract to be mostly clear. Patents come into play due to google making new hardware for better Lidar and finding out it was copied directly. This is truly one of the most clear cut reasons to sue for in any market.

Ultimately this is a suit about revenge to show the next guy not to take data to other employers. This is a common suit in many older industry's like consulting or sales where it's clear taking customer lists or internal corporate strategies out of the firm will result in lawsuits for both the person and the firm who hires him or her.

Uber should have easily known that taking this data opened up huge risks to the firm and instead paid the engineer to rebuild the solution from scratch.

In my own business this call is made all the time, using other firms secret material that employees save from old jobs often comes up and the correct response is always, if it's in your head it's fair game to rebuild, but if it's something created for an old employer then don't touch it with a 10 foot pole.
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Anonymous Coward, 28 Feb 2017 @ 7:30am

It sounds to me like the thing is primarily over trade secrets, and patents are just sort of in there because 'throw everything at the wall and see if it sticks' -style lawyering?
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Anonymous Coward, 28 Feb 2017 @ 8:01am

Re: Re: Re:

The entire case is over theft and breach of contract to be mostly clear.

What theft?
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The Wanderer (profile), 28 Feb 2017 @ 8:05am

Re: Re: Why protect trade secrets by law?
I can potentially see some value in penalizing outright corporate espionage in that way, but I draw a distinction between that and simply leaking trade secrets. Leaking the information should certainly be justification for being fired, or even for the company refusing to do business with you in the future; it should not be justification for criminal penalties, or even civil fines.

Where I don't understand things is on the question of what public benefit there is to having such legal restrictions. With patents, the public trades a limited period of exclusivity for the guarantee that the knowledge will be public domain after that period; with trade secrets, as far as I can see, the public trades permanent exclusivity - and the costs of enforcing that, on behalf of the companies involved - for... not much.

I read you as arguing that the public trades that exclusivity for the lack of onerous, draconian security practices on the part of the companies involved. For one thing, I don't find it convincing that this trade-off is necessarily worth it; for another, I'm not sure that it's plausible that many companies would actually be willing and able to go that far, in the face of possible-to-likely public objection to such policies.

One famous example of a trade secret is the recipe for Coca-Cola. I see no public benefit from imposing penalties under the law for making this recipe public. If Coca-Cola thinks the benefits of keeping that recipe secret are sufficient to outweigh the costs of doing so (including the public-image cost of draconian security policies), they are free to do that as much as they want - but if they want the law to enforce their control of that recipe, they should have to file the recipe publicly, under one or more of the established categories of intellectual property (the most plausibly relevant being "patents"). If they don't want to publicize the recipe, they should not get legal protection against having it used by or shared with other people, unless the public receives a commensurate benefit to counterbalance the cost (of not having access to the recipe, and of enforcing that lack of access).

I think the reason it becomes a confusing area of law is because a lot of companies misuse or, by claiming things are trade secrets which are not.

I'm a little confused. As far as I'm aware, the definition of a "trade secret" is essentially "information which the commercial entity which controls it declares is a trade secret, and refuses to reveal", which would mean that anything which a company claims to be a trade secret is a trade secret. Is there a legal definition which does not boil down to that? Can you give an example of something which is claimed to be a trade secret, but is not really a trade secret, and explain why it is not one?
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Anonymous Coward, 28 Feb 2017 @ 8:42am

Re: Re: Socialist Mike
Is that you, Alex Jones?
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pixelm1 (profile), 28 Feb 2017 @ 9:23am

Re: Re:
The argument for why this is bad, is that it harms the people who put in the effort to develop the technology. Here that is Google. It creates an incentive to sit back passively and just steal someone else's investment. So that is bad from a societal point of view - we WANT people to make that initial investment. That's the core goal of IP.

You always make the "well Google still has the stuff, so what have they stolen" argument. It's bogus because it is way too narrow. You've taken a "non-rivalrous good" description and planted it on IP. If people sneak into a theater into an empty seat, if they take a college course without paying tuition, if they free-ride on someone's hard work, they are hurting the social compact that these are things that cost money, and there is an expectation that the people who benefit will pay whatever is being charged for them (or, in the case of Google, the company that made the investment will have the opportunity to be the one who reaps the rewards). Competition is great - but do it fairly, invest the money, innovate - don't steal.
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Anonymous Coward, 28 Feb 2017 @ 9:42am

There Mikey goes with the play it down word play. If it had been anyone else Mike would've thought they should be placed under the jail (and that would be lenient). However, because it's Google.... he's merely "disappointed". Well, you poor little baby you.

Google should be shot at dawn - multiple times.
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Anonymous Coward, 28 Feb 2017 @ 9:43am

Re: Re:
You ask "what was lost?" Sad question coming from you, I expected much better. The lawsuit states that proprietary information and trade secrets were lost. The law does give protections for those. Basically, you have a right to keep your own information, and some privacy rights for it. Even if you're a corporation, a large group of stockholders. The right is sole ownership, essentially.

Now, does Waymo still have sole ownership of their private information? It would appear not, according to their lawsuit. That's theft, depriving them of their privacy surrounding their data.

There are a lot of ways you can look at this. But frankly, I'm surprised at you. You're always standing up for privacy. And here you're arguing against it. You're arguing that Waymo's shareholders should invest in research, then just give away all their data to the market because you want them to? They don't get to make their own decisions on what stays private, through their hired corporate leaders?

Talk about irony.

At this point, every former employee that carried away or assisted or conspired in carrying away data is potentially guilty of violation of the Economic Espionage Act, and not just

Note: I said potentially because I'll leave the guilty verdict to the court. Same with the alleged loss. The court gets to decide the truth here, not me.

Personally, I'm sorry to see all this happen, too. And I would point out a couple of things to weigh in your struggle to think through this. Google didn't get to be big by giving away all their proprietary info. They did give away some, and it was clearly to help with their primary business.

Waymo has to have some sort of market lead if it wants to have some control in the market down the road as standardization occurs. As they grow and their influence grows in the fledgling market, I would expect that more IP will be released to help direct that market for their profit. Until then, they don't want to let someone else take the lead. So while I hate to see the fight, I blame that on Uber for their alleged criminal violations.
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Anonymous Coward, 28 Feb 2017 @ 9:45am

Re: Re: Re:
paragraph 5 - I messed it up somehow. It was supposed to end: "and not just Uber as a corporation or its corporate leaders."
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Paul, 28 Feb 2017 @ 9:59am

Re: Re: Re: Re:
Theft- The taking of data he did not won and was entrusted to protect. He copied the data and gave it to an outside company.

If you want to get really really legal technical, then the term is breach of contract and breach of duty to protect. In addition, for accepting and using the data its interference in a contractual obligation (from Uber).

So stop playing word games, by taking the data and giving it to Uber, he is a thief. The legal rules around it are more specific.
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Anonymous Coward, 28 Feb 2017 @ 10:28am

Unusual that 18 USC 1832 is not specifically called out in the complaint. It is a key provision of the Economic Espionage Act of 1996 and creates a federal claim for the theft of trade secrets. Yes, theft appears in the statute, and refers to the wrongful taking, misappropriation, etc. of trade secrets.

Also surprised there does not appear to be a claim of one or more of the defendants having breached the common law duty of loyalty owed by employees to their employer.

Finally, the Federal Rules of Civil Procedure and caseload strongly encourage that a party to a lawsuit assert all known claims it may have against the adverse party/parties. In certain circumstances the failure to do so may cause omitted claims to be deemed forfeited. Hence, the recitals concerning alleged infringement of 3 patents are fully expected.

As for TD's views re trade secrets, I have to wonder if it would show the same attitude if its confidential legal strategy for dealing with a pending lawsuit was wrongfully disclosed to the public.
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Anonymous Coward, 28 Feb 2017 @ 10:32am

In 52, next to last para, caseload should read caselaw.
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Derek Kerton (profile), 28 Feb 2017 @ 11:03am

Re: Re: Re: Patents are different to data
Good point. Another example is that Tesla's crown jewels right now is the knowledge they are gaining from "fleet learning" where all their cars shipping with autonomous driving sensors are feeding information back into Tesla's cloud.

It's not hard to understand why THAT particular information is NOT being shared in an open database by Musk.

Musk did a great thing by sharing the basic building blocks, but he's not going to give away the most recent knowledge or secrets. In a football analogy, he'll help the others get to the 90 yard line, but they're gonna have to compete and carry the ball the last 10 themselves.
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Mike Masnick (profile), 28 Feb 2017 @ 11:49am

Re: Re: Re: Yeah, I don't get your point here, Mike.

You talk a lot about companies respecting their audiences and their communities. I think this is one time you should seriously listen to what we are saying.

The reason I'm responding so much is because I respect the community and I'm trying to have a discussion. Do you think I've been rude or unfair to any of the serious commenters?

I'm engaging in this conversation because so many are disagreeing with me and I'm trying to discuss to see if I can figure out where we differ. It's possible that I'm wrong here, but it's also possible I haven't explained myself carefully.

I think not respecting people here would be totally ignoring it as everyone insists I got this wrong. I'm doing the opposite.
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Mike Masnick (profile), 28 Feb 2017 @ 12:07pm

Re:

There Mikey goes with the play it down word play. If it had been anyone else Mike would've thought they should be placed under the jail (and that would be lenient). However, because it's Google.... he's merely "disappointed". Well, you poor little baby you.

Can you point to an example where I've said anyone should be placed in jail for anything even remotely like this?

Thanks.

It's bizarre that in a story where I'm bashing Google (and where no one else in the comments agrees with me) I'm being told that I'm being too nice to Google.
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pixelm1 (profile), 28 Feb 2017 @ 1:05pm

Re: Re: Re: Why protect trade secrets by law?
Trade secrets are different than patents. A person can be sued as an infringer of a patent without knowing about the patent, and without copying and without any relationship to the owner of the IP. That's why there can be a patent "troll" and why the rights are more narrowly circumscribed.
To violate a trade secret, you have to have a relationship that you knowingly breach. So there is little need to define precisely the IP - it's enough that you knew it was secret and violated the trust.

As to the "why" IP supports not just creation but also investment. Coca-Cola has built a large business on that trade secret. If everyone could sell Coca-Cola, Coca-cola would have little incentive to invest in distribution, marketing, etc. - so the trade secret generates economic activity that creates jobs. The trade secret doesn't prevent other people from inventing their own soft drinks - they could even sell an identical drink as long as they come up with the formula themselves. So trade secrets have a limited negative effect on competition and are generally thought to be pro-competitive and benefit consumers.
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Mason Wheeler (profile), 28 Feb 2017 @ 1:25pm

Re: Re: Re: Re: Why protect trade secrets by law?
Coca-Cola has built a large business on their branding. The "secret formula" to Coke isn't all that secret; you can find it floating around the Web easily enough.

The true "secret" to the flavor is that they use coca leaf extract with all the actual cocaine removed, and of course the government is not all that keen on letting people import it. (Unless of course you're Coca-Cola and can invoke "whoever has the gold makes the rules.") So it's very difficult for anyone else to replicate the exact taste.
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orbitalinsertion (profile), 28 Feb 2017 @ 1:32pm

Re: Re: Re:
"Theft" is a very specific term. I am sure you are trying to have it acknowledged that things like corporate espionage are wrong. And you won't get much argument. But just because people like to commonly say things like "theft of trade secrets" for exfiltrating trade secret data, it doesn't make it "theft", where the stolen item is no longer accessible to the original owner.

Maybe you are hung up on definitions and think this is nitpicky, but it is actually an important distinction that has had to be made repeatedly over the years. Or do you simply want to classify such things as "theft" for some other reasons. (It isn't that the examples are misunderstood; we are looking for an argument that this is actually theft.)
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JMT (profile), 28 Feb 2017 @ 3:24pm

Re: Re: Re: Yeah, I don't get your point here, Mike.
"Google provides a valuable public service, whereas Uber seems to be engaged in a full-out sprint lately to see how fast they can reach, and then surpass, Comcast levels of corporate evil in the public eye."

This is a poor comparison. Comcast's customer hate the service they get from them because it's generally awful, but Uber's customers generally love the service they receive because it's so much better than the typical taxi experience. People's opinion of their corporate performance is a completely different thing.
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Anonymous Coward, 28 Feb 2017 @ 3:42pm

Re: Re: Re:
While possibly, likely the person that copied that information, also designed a lot of that information in the first place.
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Anonymous Coward, 28 Feb 2017 @ 3:53pm

Re:
Google should be shot at dawn - multiple times.

Wow! What did Google do to you? I wouldn't even ask that of some of the worst companies like Comcast.
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Anonymous Coward, 28 Feb 2017 @ 5:11pm

Re: Re: Re: Re:
See, e.g., the Economic Espionage Act of 1996, and in particular 18 USC 1832. Theft is a legal term, and there are sections of law where the term is applied to more than merely physical objects.
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Anonymous Coward, 28 Feb 2017 @ 5:57pm

Re: Re: Re:

The lawsuit states that proprietary information and trade secrets were lost.

I've read the filing. It says no such thing. What? You thought no one would check?
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Anonymous Coward, 28 Feb 2017 @ 6:01pm

Re: Re: Re: Re: Yeah, I don't get your point here, Mike.
Nah, they think not agreeing with them is "disrespecting" them.
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Anonymous Coward, 28 Feb 2017 @ 6:03pm

Re: Re: Re: Re: Re:

If you want to get really really legal technical, then the term is breach of contract and breach of duty to protect.

Which is not theft.

So stop playing word games,

Stop lying.

by taking the data and giving it to Uber, he is a thief.

Stop lying.
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Anonymous Coward, 28 Feb 2017 @ 6:12pm

Re: Re: Re: Re: Re: Why protect trade secrets by law?
Coca-Cola still has cocaine in it. They just add another secret government-supplied chemical that not only keeps it from showing up on tests but also helps keep the population complacent.
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Anonymous Coward, 28 Feb 2017 @ 6:18pm

Re:
18 USC 1832 redefines speech as theft. Nice!
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Anonymous Coward, 28 Feb 2017 @ 6:35pm

Re: Re:

18 USC 1832 redefines speech as theft.

Not really. "Theft" is in the title but laws are often misleadingly titled. You can write a law against spitting on the sidewalk and title it "Rape of babies" that does not make spitting on a sidewalk baby rape.

While 18 USC 1832 does cover actual stealing, it also covers non-stealing copying.
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My_Name_Here, 28 Feb 2017 @ 9:30pm

Re: Re: Re: Re: Yeah, I don't get your point here, Mike.
I actually have to say honestly that this is a very different Mike Masnick from usual. Usually you would shut down a discussion like this with an offhanded put down and call it even. That you are still here plugging away at it shows something new.

I gotta think that whole lawsuit thing is bothering more than a bit, but that would be an aside.

This is a case where you have carefully explained yourself, but that you appear to be totally wrong. The patents and the information involved in testing them are two different things, but one is predicated on the other. Infringing the patents by themselves would be an issue and perhaps you might have a shout at saying Google should share more. However, when you combined the patents with significant data based on testing that Google / Waymo did based on those patents, then you have a very untenable situation. It's not just a question of looking at a patent and working from there, but rather also profiting from hard work already done to turn the patents into actual functional end products.

If Otto or whoever takes a massive shortcut by using the work (and not just the patents) from Google / Waymo, they are saving themselves a ton of money and time avoiding perhaps some dead ends or being able to start at a "model 2" version of a product rather than having to go through all the expensive development and testing to even find a proper working model to base themselves off of. That is a huge issue.

It's not disappointing to see Google suing, it would actually be disappointing if they didn't. This is over the top and left alone would be a very bad example for all companies in the future.
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Anonymous Coward, 28 Feb 2017 @ 10:15pm

Propaganda as entertainment
Come on, Mike, come clean with your readers. The TechDirt slogan is "Advertising is content, content is advertising", right? This mixture is called "propaganda" by the more educated, and propaganda is how you make your money, right? The truth is that this is a straight propaganda piece you were paid to promote, right Mike? It only looks "weird" because you are saying directly what you usually say through a fake web site or other misdirection. Not that I blame you for being more careful. Your whole life is under a microscope, your every word radioactive, as (literally) everything you say can and will be used against you in a court of law.
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Anonymous Coward, 1 Mar 2017 @ 2:49am

Re: Propaganda as entertainment
Usually there are one or more opinion sites thst can be pointed ti in order to support the story. You are tight in this case that this story is a bit naked, and mike's misunderstanding of it all seems a little bit unreal

Its almost like he has been asked to put a gap between techdirt and Google, to somehow show independence, without really raking them iver the coals.

The whole piece reads more scripted than thoughtful, and the failure to understand almost comical.
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Anonymous Coward, 1 Mar 2017 @ 4:24am

Re: Re:
This comment makes no sense. Elaboration is needed if you want people to grasp the point you are trying to make.
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Wendy Cockcroft, 1 Mar 2017 @ 6:08am

Re: Re: Re: Socialist Mike
"Socialist" means "boogeyman" to these guys, Mike.
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Wendy Cockcroft, 1 Mar 2017 @ 6:13am

Re: Re: Re: Re: Re: Re: Why protect trade secrets by law?
Citation? I've never got high from drinking the stuff.
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Anonymous Coward, 1 Mar 2017 @ 3:06pm

Re: Re: Re: Re:
Learn to read and understand.

From the filing: pg 5, par 12: "Waymo LLC owns all of the patents, trade secrets, and confidential information infringed or misappropriated by Defendants."

Now, if you have a trade secret and it's misappropriated, it's no longer a secret, is it? Oh, sure, you could split hairs and say they took copies, so you haven't "lost" the information. But really? Now someone else knows it. Hence, your control over the information is lost. The court is the only option to righting that, to returning it to its former confidentiality, if such a thing is even possible.

If you really want to have a stupid argument over splitting hairs of how I stated the obvious, wow. The real issue here is that this isn't so much about patent trolling as it is about corporate espionage.
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Anonymous Coward, 2 Mar 2017 @ 7:06am

Re: Re: Re: Re: Re: Re: Re: Why protect trade secrets by law?
It's the stuff they put in chem-trails. Don't you ever read infowars?
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Anonymous Coward, 6 Apr 2017 @ 9:28pm

Lots of comments about "theft" and "corporate espionage" because Google said so.

The facts are thus:

1. Everything that was accessed at Google was accessed by Google employees while they were employees at Google.

2. There is zero actual evidence any of Google's employees were accessing data outside of things they needed for their job.

3. There has been one Google work file found, on an ex-Google employee's cell phone who now works for Uber. I'm surprised there isn't most if people are still using the same cell phones as when they were at Google. It hasn't been published what the file is and it wasn't on the cell phone of any "key player" in this case.

4. Other than #3, there is zero evidence that any files were given to Uber, that Uber colluded with anyone about anything or that anything was stolen, anywhere.

These are all accusations, along with patent lawsuits and some other accusations thrown in for good measure.

If ex-employees were breaking into Google's servers, that would be one thing. But that's not the case.

What this lawsuit is about is Google telling its employees that if they work for a competitor, they will get in a lawsuit. And if you hire Google's employees, you will get sued.

Remember, Google is among the companies that paid $415 million to end a lawsuit about conspiring with other tech firms not to hire each other's employees.

A quote..

Schmidt then sent the request on, saying "I believe we have a policy of no recruiting from Apple and this is a direct inbound request. Can you get this stopped and let me know why this is happening? I will need to send a response back to Apple quickly so please let me know as soon as you can."

Now everyone knows. Hire a Google employee, get sued. Be a Google employee and you'll get involved in a lawsuit if you leave.
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Anonymous Coward, 6 Apr 2017 @ 9:32pm

Re: Re: Re: Corporate espionage &/or CFAA
The specific software he installed was an open source version control system. The one you use to access files under version control. It is what you when you are doing development.

There is nothing unauthorized about it. It was part of his job.
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