lawsuits – Rideshare Central

2017 – The Rideshare Year In Review

December 28, 2017/in Blog/by Dave

Alright, here’s the major events from the rideshare sector in 2017.

January

Taxi drivers strike at NY airports in response to Trump’s Muslim ban. Uber refuses to support the strike or stop surge pricing. The #DeleteUber Movement begins in response.
Uber settles a Federal Trade Commission lawsuit that charged that it misled drivers about pay. The settlement was for $20 million. Uber did not admit wrongdoing as part of the settlement.

February

Amit Singhal, Uber’s Senior VP of engineering, resigns because he didn’t tell Uber that he left Google because of a credible allegation of sexual harassment.
Waymo (a Google subsidiary) sues Uber for stealing self driving car technology. The lawsuit is ongoing. Google wants at least $1 billion in damages.
Uber CEO Travis Kalanick is caught on video being an asshole to a driver.
Sarah Fowler, a former Uber engineer, writes a blog post detailing the pervasive sexual harassment she had to endure while at the company.

March

Uber temporarily halts its self driving car program after one of its vehicles crashes in Tempe, Arizona.
Lyft settles a driver mis-classification lawsuit (employee or independent contractor) for $27 million.

April

Thousands of Uber & Lyft drivers fail new stricter Massachusetts background checks.
Lyft raises $500 million at $7.5 billion valuation.

May

Lyft and Waymo enter into a strategic autonomous vehicle partnership.

June

Uber & Lyft return to Austin after leaving in 2016.
Jaguar Land Rover invests $25 million in Lyft.
After months of pressure, Uber CEO Travis Kalanick resigns.
Uber finally adds tipping as part of its recently lauched 180 days of change.
Eric Holder delivers his report on sexual harassment to the Uber board. It’s scathing.

July

Uber market share falls from to 77%, from 84% at the beginning of 2017.

August

Lyft announces it has doubled the number of rides given in 2016, in just the first six months of 2017.

September

FBI admits there’s a criminal probe into Uber’s attempts to monitor Lyft drivers.
London strips Uber of its operating license.

October

Alphabet, Google’s parent company invests $1 billion in Lyft.

November

Lyft raises another $500 million.
Uber admits it covered up a massive data breach of driver and rider information, likely breaking many state and federal laws in the process.
Softbank offers to invest in Uber at a 30% discount, calling into question Uber’s $68 billion valuation.

December

The Justice Department forwards a letter to the judge in the Waymo v. Uber trial, letting the judge know that Uber may have withheld evidence in that case.
As part of the kerfuffle in the Waymo v. Uber lawsuit, it comes out that Uber is now the subject of five criminal investigations.

Be sure to check back this weekend for our 8 Rideshare Predictions For 2018.

Confirmed: Uber Is The Subject Of Yet Another Criminal Investigation

December 14, 2017/0 Comments/in Blog/by Tracy Ballard

Uber is already the subject of four separate criminal investigations, and now we know there is a fifth investigation.

Recap Of The First Four Uber Criminal Probes

First, the DOJ is currently investigating Uber’s use of its Greyball software tool. This is the tool which Uber used to hide its vehicles from law enforcement officials.

Second, the feds are whether Uber violated price transparency and anti-discrimination laws related to its Upfront Pricing Model. This probe is looking at Uber’s tools Cascade and Firehose. Cascade is the tool Uber uses to set fares based on time, mileage and demand. Firehose is the tool Uber uses to charge passengers an upfront rate. Used together, these tools may violate Federal pricing discrimination laws.

Third, there is the federal bribery probe. It’s investigating how an Uber executive obtained the medical records of a woman raped by an Uber driver in India.

Finally, the fourth probe involves Uber’s use of its Hell software, which it used to track Lyft drivers.

The Fifth Uber Criminal Probe

The latest criminal probe involves the Uber v. Waymo (Google) lawsuit. Yesterday, Judge Alsup unsealed a letter from the Department of Justice that caused him to delay the start of the trial. The trial was originally supposed to start on December 4.

The letter offers confirmation of this fifth criminal investigation. It also alleges that Uber used “non-attributable electronic devices to store and transmit information” and that they could have used such devices to steal intellectual property.

From the letter (full letter at link):

Mr. Jacobs further stated that Uber employees routinely used non-attributable electronic devices to store and transmit information that they wished to separate from Uber’s official systems. He surmised that any wrongfully-obtained intellectual property could be stored on such devices, and that such action would prevent the intellectual property from being discovered in a review of
Uber’s systems.

What Does It All Mean?

Yikes, that sounds like Uber could have deliberately set out to steal Waymo’s self-driving car tech. Uber also could have taken significant measures to cover its tracks. There’s a distinct possibility that some former Uber executives may be facing some jail time. There’s also the matter of the massive Uber data breach, which is already the subject of some state and local probes. Don’t be surprised if the feds open a sixth Uber criminal investigation about the data breach.

Uber May Have Withheld Bombshell Evidence In Lawsuit! (Google v. Uber Update)

December 1, 2017/in Blog/by Dave

Waymo (Google) v. Uber Lawsuit Update

Well, it’s been quite a week in the multi billion dollar Uber – Waymo lawsuit!

On Tuesday, Judge Alsup, who’s presiding over the Waymo v. Google case, accused Uber of withholding evidence, and delayed the start of the trial. The trial was supposed to begin next week, but now it won’t start until next year.

For those who haven’t been following, Waymo (a Google subsidiary) is suing Uber, accusing them of conspiring with a former Google employee to steal self-driving car technology. For more details, read our brief primer on the case.

Case Primer: What is the Uber Google lawsuit all about?

The Big Deal: Uber Withheld What Could Be A Crucial Piece Of Evidence

Last week, the U.S. attorney’s office forwarded a piece of evidence from their own Uber criminal investigation, to Judge Alsup. It’s pretty unusual for a U.S. attorney to send evidence to a judge in an unrelated civil case, a week before the trial is supposed to begin.

The evidence is a 37 page letter written to Uber by the lawyer of former Uber employee Richard Jacobs, during an employment dispute. The contents of the letter are nothing short of explosive.

In short, the letter alleges that Uber trained employees to steal trade secrets and hide their tracks. It says Uber actually had a special intelligence unit dedicated to stealing trade secrets. Members of the unit communicated using disappearing messaging apps, which would shield or destroy evidence from any potential lawsuits. There is an ongoing criminal investigation into the allegations made in the letter.

[su_box title=”Columbo may have more questions for Uber.” style=”soft” box_color=”#d1a927″ title_color=”#d1274f”]

Photo By Prawny[/su_box]

Uber said the letter was extortionate. However, this seems highly unlikely.

Related:

Uber did fire Jacobs in April. However, after receiving the 37 page letter, Uber, in August, settled with Jacobs and paid him $4.5 million (his lawyer also got $3 million). They also hired him as a consultant for the next year.

If that wasn’t bad enough, it turns out Travis Kalanick, and some Uber board members knew about the letter.

Understandably, Judge Alsup was very unhappy. He wanted to know why Uber didn’t hand over the letter to Waymo months ago. He also wanted to know why they paid Jacobs $7.5 million and hired him as a consultant if he was extorting them. Overall, it has not been a fun week for Uber’s lawyers in Judge Alsup’s courtroom. Here’s some of the things he told Angela Padilla, Uber’s deputy general counsel, this week.

“That is a lot of money. And people don’t pay that kind of money for BS. And you certainly don’t hire them as consultants if you think everything they’ve got to contribute is BS.”

“We had to continue an entire trial because of your decision… You wanted this case to go to trial so that they [Waymo] didn’t have the benefit of this document. That’s how it looks.”

“…on the surface, it looks like you covered this up.”

“I can no longer trust the words of the lawyers for Uber in this case,”

“If even half of what is in that letter is true, it would be an injustice for Waymo to go to trial (next week).”

Wow, did I say unhappy? I think Judge Alsup might actually have been really pissed off.

Overall, this was a really bad week in court for Uber. During previous settlement talks, Google requested damages of $1.5 Billion. Uber really can’t afford that given their ongoing massive losses. The Jacobs letter could significantly bolster Google’s case.

Judge Alsup has asked U.S. prosecutors to investigate Uber’s actions. He has delayed the start of trial until February, 2018.

Uber fires more than 20 employees — including senior employees — after internal investigation

June 6, 2017/in Blog/by Dave

More than 20 employees have been fired from Uber after a sexual harassment investigation

Uber is delaying the release of its investigation into gender bias, report says

June 5, 2017/in Blog/by Dave

Uber engineer Susan Fowler alleged the company failed to act on sexual harassment and gender discrimination complaints

Waymo Uber lawsuit update.

May 7, 2017/in Blog/by Dave

What’s happening in the Waymo Uber lawsuit

As you may know, Waymo, Google self-driving car unit is suing Uber for stealing their technology. Currently, the Waymo Uber lawsuit is in the discovery phase. Prior coverage from Rideshare Central since the case was filed:

Here’s what’s happened in the last few weeks. Most, but not all of it, is bad for Uber.

On April 14, Anthony Levandowski took the fifth over 400 times during his deposition.
On April 25, a federal appeals court denied Mr. Levandowski’s attempt to shield certain documents from the case.
On April 28, Mr. Levandowski stepped down from his position as head of autonomous vehicles at Uber, but still remains at the company.
On May 3, a hearing was held about Waymo’s request for a restraining order on Uber’s self-driving car project. The judge didn’t issue a ruling on the restraining order, but that should come in the next few days. CNET has coverage of the hearing here.

At this point, Waymo probably needs to show the judge something more if they’re going to get an injunction. Right now, they’ve shown that Mr. Levandowski downloaded confidential files. What they haven’t shown is whether Uber saw or used those files. Uber denies they did, but they haven’t turned over Mr. Levandowski’s laptop or approximately 3,600 other files, citing attorney client privilege. The judge should issue a ruling in the next few days.

Google v. Uber: A primer on the lawsuit that could threaten Uber’s future

March 17, 2017/in Blog/by Dave

The Google Uber Lawsuit: What’s it all about?

In a nutshell, Google is accusing Uber of stealing the technology at the heart of its self-driving car.

See, back in 2009, Google began developing a self-driving car. Over the last seven years, Google has spent a ton of money and time developing and testing a fleet of self-driving cars. Much of the money was spent developing the part of the car that makes it self driving, the LiDAR system.

LiDAR is the radar on the car that keeps it from running red lights, hitting pedestrians, and crashing into walls. LiDAR systems can tell the difference between a person in a crosswalk and a mural of a person on building wall. Google’s LiDAR system is really advanced, probably the most advanced in the world, and has taken them years to develop.

Stole the LiDAR? Tell me more.

What happened?

According to Google, this is what Uber and a former Google employee did. In late 2015, a Waymo (Google’s self driving car subsidiary) exec, Anthony Levandowski, told a Waymo colleague that he had spoken with an Uber exec about forming a self-driving car startup that Uber would buy.

In December, 2015, Levandowski downloaded almost 10 gigabytes of data (including trade secrets in the form of 14,000 proprietary files) from Google’s Waymo design server onto his work laptop. He then copied that data off of his laptop onto an external drive over eight hours. A few days later, Levandowski wiped his work laptop and stopped using it.

In January, he downloaded more files from Waymo’s servers. On January 14, 2016, he met with Uber execs at Uber headquarters. On January 27, 2016, Levandowski quit Waymo, without any notice. While he did not take a self driving car on his way out of Waymo, Google says he took the (patented, secret, and valuable) means to build one, and boy are they pissed.

Anyways, Levandowski starts a self-driving truck company named Otto. He met with Uber CEO Travis Kalanick multiple times in the Spring of 2016. The two shared a series of ten-mile moonlight walks, while discussing…who knows, the potential acquisition of Otto, or the problems Uber’s own self-driving car unit was having?

Fast forward to August 2016. Levandowski receives his final multimillion dollar payment from Google. On August 19, Uber buys Levandowski’s self-driving truck company, Otto, for $680 million. Did I mention Otto had developed a top notch LiDAR system in six months? It’s true. They had a self-driving truck deliver some beer.

After the sale, Google began to suspect something and started investigating Levandowski’s downloading and wiping habits. Then, on December 13, 2016, Christmas came early for Google’s lawyers at Quinn Emanuel. Someone accidentally copied a Google employee on an email that contained a drawing for Otto’s LiDAR circuit board, which bore a substantial similarity to Google’s LiDAR board. Seriously, someone broke out the Johnnie Walker Blue at Quinn that night.

Google Uber lawsuit libation for Quinn Emanuel lawyers

Can’t wait for the deposition!

Will anyone go to jail?

It’s possible, but not probable, at this point. While Google may have contacted the FBI, they generally don’t comment when they’re investigating things. That being said, stealing trade secrets can get you ten years, so it’s a certainty that Mr. Levandowski has retained counsel by now.

What does it mean for Uber?

For drivers and riders, really nothing in the short term. For Uber investors, it’s a different story. Google has asked for a preliminary injunction. If they get it, Uber will have to stop working on its self-driving car. That would certainly put any IPO plans on the back burner and could threaten the long term future of Uber.

What is Uber worth without its autonomous vehicle program?

Uber was valued by its last investor at $69 billion. A respected Wall Street analyst recently pegged Uber’s value at $31 billion. However, if Google’s lawsuit is successful, Uber won’t be worth anywhere near either number.

Although it’s known as a rideshare company, that’s not where most of Uber’s perceived value comes from. As a rideshare company, Uber loses money to the tune of $2-$3 billion per year. Even if they raise rates and get to profitability in the next couple of years, they’re not worth $69 billion or $31 billion. Their actual value as a rideshare company is probably in the $10-$20 billion range (Lyft is worth about $7 billion). While that may sound great, it’s really not if you took a bunch of money from investors and told them you’re worth $69 billion.

The only way Uber is worth $31 or $69 billion is if they can create an autonomous vehicle and disrupt not only the taxi market, but the shipping and logistics market. See, the worldwide taxi market is worth only about $100 billion. If Uber captured half that market, (currently they’re at about 10%) they’d maybe be worth about $30-$40 billion, if they can turn a profit. However, if they develop a self-driving system that can disrupt trucking and logistics, then they could be worth $69 billion, or far more.

The reason is that the worldwide logistics industry is an $8 trillion market (80 times as large as the potential rideshare market). Making a dent in that market is the only way Uber can justify a $69 billion valuation. The only way Uber makes a dent in logistics and shipping is if they can develop a first class autonomous driving system. Unfortunately, Google says they stole theirs.

Interested in driving?

Posts