back to article Judge stalls Uber trade-secret theft trial after learning upstart 'ran a trade-secret stealing op'

A judge today delayed the start of a trade-secret theft case against Uber – after evidence suggesting the upstart operated a secret trade-secret-stealing unit was revealed at the last minute. US district judge William Alsup said it would be a "huge injustice" for the trial to start as scheduled next week, after he was sent a …

  1. Anonymous Coward
    Anonymous Coward

    Corporate death penalty

    If ever there was a company who deserved such a thing, it is Uber.

    1. TSG
      Mushroom

      See Icon

      ‘Nuff said.

    2. Michael Thibault

      Re: Corporate death penalty

      Sadly, you have to start somewhere.

      Corporation Kill Switches Now!

    3. Anonymous Coward
      Anonymous Coward

      Re: Corporate death penalty

      Uber do seem to have an institutional preference for shenanigans over legality.

  2. Youngone Silver badge

    An already extraordinary trial has just got bigger.

    Crickey, has it what!

    Someone is lying, and if I have learnt one thing from cop dramas on TV it is that the judge does not like that at all.

  3. Alan Brown Silver badge

    Ruh Roh Shaggy

    Judge Alsup is a very bright cookie and has done a pretty good job in slashing copyright trolls down to size. if he's peeved this isn't going to end well for Uber.

  4. G Mac
    WTF?

    When do the magic words...

    ... "RICO Act" start to get mentioned in hushed tones?

    https://en.wikipedia.org/wiki/Racketeer_Influenced_and_Corrupt_Organizations_Act

    1. Throatwarbler Mangrove Silver badge
      Stop

      Re: When do the magic words...

      It's not RICO.

      1. G Mac
        Go

        Re: When do the magic words...

        Really?

        'To win, a plaintiff would have to prove (1) conduct, (2) of an enterprise, (3) through a pattern, (4) of racketeering activity called "predicate acts," (5) causing injury to the plaintiff’s "business or property."'

        And predicate act would include theft and fraud...?

        Interestingly, this has been through the El Reg meat grinder before in April - search for RICO:

        https://forums.theregister.co.uk/forum/1/2017/04/24/uber_cloaked_its_spying_but_apple_gave_it_a_wrist_slap/

        1. katrinab Silver badge

          Re: When do the magic words...

          We have (1) conduct, (3) through a pattern

          We probably have (4). It is restricted to some federal offences, but Über likely manage it

          and we have (5) damage

          Where it appears to fall down is in the definition of (2) enterprise

          1. lglethal Silver badge
            WTF?

            Re: When do the magic words...

            Your saying a Company isnt an Enterprise?

            1. katrinab Silver badge

              Re: When do the magic words...

              "Your saying a Company isn't an Enterprise?"

              It appears the answer to that is, yes. A company is not an enterprise.

              An enterprise, for the purposes of RICO is something like the Mafia, or ISIS; not a legally constituted company like Über.

              1. phuzz Silver badge

                Re: When do the magic words...

                "An enterprise, for the purposes of RICO is something like the Mafia, or ISIS; not a legally constituted company like Über."

                So what you're saying is, if Uber's 'Strategic Services Group' was definitely part of Uber (same payroll etc.) then they can't be charged under RICO?

              2. Naselus

                Re: When do the magic words...

                "An enterprise, for the purposes of RICO is something like the Mafia, or ISIS; not a legally constituted company like Über."

                No, the enterprise can be a legally constituted company. The issue is that the defendant in the case must be a member of the enterprise, rather than the enterprise being the defendant itself. So you could sue, say, the CEO of Uber under RICO and list Uber as the criminal enterprise in question (since it's becoming hard to deny that it is, in fact, a criminal enterprise), but you can't sue the legal entity known as Uber for being a member of Uber, because it isn't a member of itself.

                Of course, you generally wouldn't use RICO to go after a legally constituted company, because there's much better tools for doing that - RICO was originally put together because mafias and crime families tended not to go and file convenient lists of all their employees and directors, whereas a properly constituted company does that by definition. But in Uber's case, they appear to have been going to some lengths to try and produce 'shadow' groups who were operating as part of the company but legally weren't included.

                Which means that, in actual fact, it might be RICO.

                1. katrinab Silver badge

                  Re: When do the magic words...

                  Well Über London has been found guilty in the Employment Tribunal of not filing proper lists of its employees.

                2. handleoclast
                  Coat

                  Re: When do the magic words...

                  but you can't sue the legal entity known as Uber for being a member of Uber, because it isn't a member of itself.

                  The law is complicated. When it drags in Russell's paradox it becomes very complicated. If Gödel's incompleteness theorem shows up then it has become insanely complicated.

  5. Doctor Syntax Silver badge

    I suppose they've got a spare ex-CEO they can throw under the bus taxi when things turn really nasty. And no shortage of taxis to throw him under.

  6. veti Silver badge

    "Stealing trade secrets"?

    If you choose to keep something a "trade secret", surely the onus is on you to keep it from being stolen. If you can't do that, then you don't deserve it. Try patenting it instead.

    You can charge people with unlawfully revealing trade secrets. But if your rivals somehow get hold of them, I don't see how you can (coherently) charge those rivals with doing anything wrong. They're like journalists publishing a leak - the person you go after is the leaker, not the publisher.

    Uber is being fitted right up here.

    1. Doctor Syntax Silver badge

      Re: "Stealing trade secrets"?

      "surely the onus is on you to keep it from being stolen."

      And to that end you would place employees privy to the secret under contract terms not to disclose it. If - and I'm not saying this happened in any particular instance - a rival bribed such an employee to disclose the secrets I'm sure there'll be various statutory offences covering this in most jurisdictions.

      A more interesting point is "stealing". Normally theft involves taking something with the intent of permanently depriving the owner of it and simply copying it fails on the deprivation part. But if something is a secret taking a copy means it's no longer secret so there has been deprivation; maybe theft really applies in such a case.

      1. kain preacher

        Re: "Stealing trade secrets"?

        IN the US this falls under corporate espionage. Also in the US theft means to simple take some thing that does not belong to you. No matter what your intent was

        1. Anonymous Coward
          Anonymous Coward

          Intent?

          I don't know where you got your information, but you are quite wrong.

          While the statuary definition can vary slightly from state to state, the usual statutory definition of theft is a person who knowingly or intentionally exerts unauthorized control over property of another person, with intent to deprive the other person of any part of its value or use.

          Note that the very definition includes the work INTENT.

          In California, Uber's home state, a prosecutor must establish the defendant's intent to permanently take or withhold the property owner's possession or right to the property.

          In Federal law they use the term Larceny, which is defined as the unlawful taking, carrying, leading, or riding away of property from the possession or constructive possession of another. While the definition does not include the word intent, it is implied by word "unlawful" which does include intent. The biggest difference is that larceny also lacks the requirement that a owner be permanently deprived of the use of his property.

      2. Woza

        Re: "Stealing trade secrets"?

        "Normally theft involves taking something with the intent of permanently depriving the owner of it"

        Is that really the case though? I think that the intent of a thief is to gain access to the stolen item (e.g: to sell). Depriving the original owner of that item is an unavoidable byproduct of the item being physical. In cases like this the intent is the same, but the byproduct can be avoided.

        1. gnasher729 Silver badge

          Re: "Stealing trade secrets"?

          "Is that really the case though? I think that the intent of a thief is to gain access to the stolen item (e.g: to sell). Depriving the original owner of that item is an unavoidable byproduct of the item being physical. In cases like this the intent is the same, but the byproduct can be avoided."

          In case of trade secrets, they give you an advantage not just by knowing the trade secret, but by the fact that you know it and others don't. That's essential to a trade secret. If someone uncovers the trade secret, then even though you still have the information, you are deprived permanently by the fact that you are not the only one in possession of the information anymore.

    2. Throatwarbler Mangrove Silver badge
      Holmes

      Re: "Stealing trade secrets"?

      If you have a "trade secret" that you keep on display in the main lobby of the building, then you can't really call it a secret. If you have a "trade secret" that you actually have made a legitimate effort to keep secret (e.g. in the local planning office's display department) and a rival is forced to circumvent significant intrusion measures to get at it, then it sounds like you were doing a pretty good job of keeping it a secret and that such circumvention is against the law, much as if I circumvented your window with a rock to get my hands on your television. IANAL, so I have no ideal whether that's true in this case, but it does sound like the judge smelled something distinctly malodorous and piscine, enough to refer the case to a federal attorney's office. There's insufficient evidence (as mentioned in the article) to know what the telltale indications might be, but I don't think judges put trials on hold on a lark.

    3. ecofeco Silver badge

      Re: "Stealing trade secrets"?

      What frickin color is the sky in your world?

  7. John Smith 19 Gold badge
    FAIL

    Uber really does not seem to grok this "disclosure" thing very well

    It's not optional.

    You have to do it

    Nor do they seem to understand the concept of "case law" or "Judges opinions" and that the US is a "common law" country.

    Uber are about to discover exactly what the phrase "I am the law" really means.

    1. Captain DaFt

      Re: Uber really does not seem to grok this "disclosure" thing very well

      Uber are about to discover exactly what the phrase "I am the law" really means.

      I think the phrase they're really about to learn is: "You are sooo screwed!"

  8. Anonymous Coward
    Anonymous Coward

    I see your contempt, and raise you a double contempt.

    ——

    In other news, Uber is appealing the ruling.

    Wait... the ruling hasn’t been made yet. Uber’s response “I know we’re guilty, and you know we’re guilty”. So, we going to preemptively challenge all the rulings for the next 20 years.

    Hopefully by the time we (Uber) lose, the fines will be insignificant do to inflation.

    1. xXSwolGunzXx

      That does seem to be their game. Ignore inconvenient laws and drag out enforcement until they're big enough to get the law changed or at worst pay any fines out of spare change. All part of an over-arching strategy of causing and exploiting as much market failure as possible.

      1. captain_solo

        I'm not sure you can get venture capital in The Valley without this business plan...

    2. ecofeco Silver badge

      That's American corporate strategy 101.

      It took 15 years before the folks in Prince Williams Sound, Alaska, received one penny of compensation for the Exxon Valdez oil spill, and by that time, the payout had been slashed to just 10% of the original judgment.

      I rather like the Chinese way: execution.

      1. kain preacher

        That works will for people, but uber is going up against google. Which one can afford armys of lawyers at $500 an hour .

  9. Anonymous Coward
    Anonymous Coward

    When are they appearing

    in a James Bond movie ?

    1. Commswonk

      Re: When are they appearing

      Damn it, I was going to say that or something very similar. Perhaps I ought to have got out of bed earlier.

  10. GcdJ

    Will UBER IPO

    So we currently have Softbank about to tender to buy-up private shares in Uber on the cheap (30% discount) - will they go ahead now, or even require a bigger discount?

    And we still have the new CEO aiming of an Uber IPO in early 2019.

    I am a firm believer in the adage that you can sell anything at the right price. But what would you want to invest $1000 in this company?

    Me thinks these plans are now in a distressed state.

    Geoff

    1. Anonymous Coward
      Anonymous Coward

      Re: Will UBER IPO

      Me thinks these plans are now in a distressed state.

      You'd have thought they'd be in disarray long ago, given the endless stream of bad news from Uber.

      But....Wall Street bookbuilders believe their own stories. And that will include the idea that all the dirt is out in the open, leadership has changed, things can only get better. And the vast appetite of investors to buy in to these fabulous stories at an IPO is such that I'm sure that an IPO could easily go ahead and get a totally unwarranted price. This is a company with no viable business model yet proven, burning cash like it is going out of fashion, and yet some fools (including Soft-in-the-head-bank) are putting $70bn valuations on Uber.

      By these idiot's logic, Uber is in the same league as Vodafone, Airbus, UBS, BMW and the like.

      1. Naselus

        Re: Will UBER IPO

        "By these idiot's logic, Uber is in the same league as Vodafone, Airbus, UBS, BMW and the like."

        And given that Uber's only actual contribution to the private hire process is an app that could be replaced by an Open Source alternative in about 45 minute's worth of coding, that $70 billion valuation is almost entirely based on the sheer scale of the criminality it appears willing to try and get away with.

        1. ecofeco Silver badge

          Re: Will UBER IPO

          based on the sheer scale of the criminality it appears willing to try and get away with

          There's your answer to most any question regarding the financial world.

  11. rmason

    Well colour me shocked!

    Wow!

    Who would believe it of such a stand-up company?

    I *almost* pity the new CEO. The lawyers were not the only ones who uber failed to disclose things to. He thought he was dealing with a bit of asshat-ery and the ultimate bro culture. Not this level of stupidity and illegality.

    1. JohnFen

      Re: Well colour me shocked!

      "I *almost* pity the new CEO."

      Not me. Uber's criminality and extreme lack of anything resembling ethics or decency have been well known for years. I have no sympathy for anyone who willingly engages with them, be it the CEO, employees, drivers, or customer. You lie down with dogs, you get up with fleas.

  12. Aladdin Sane

    Uber caught doing something shitty

    The day must end in a "Y".

  13. Milton

    It's part of the greed culture

    Companies like Uber (Airbnb being another obvious though apparently less loathsome example, or JustEat and so many others) are founded on the concept of making as much money as possible while taking as little responsibility (socially, legally, financially) as possible. They provide a technical means for People Who Want to Buy Thing to connect and pay money to People Who Can Provide Thing, and rake off some commission for having done so.

    Thus Uber has no interest in the customer except as a provider of money. It has no interest in drivers except to transport customers. The connection system it does provide will be as automated and cheap as possible. The amount of money it passes on to drivers will be the least it can possibly get away with. It will fight tooth and nail to avoid being responsible for *anything*. It will try to accept no duty of care or liability to the customers. It will try to accept no duty of care of employment commitments to drivers. As far as it's concerned, everything including people is commoditised and exploited to squeeze out cash.

    A business which depends upon customers getting a safe, comfortable, efficient ride for their money which accepts no responsibility to those customers. A business which depends upon drivers being rested, relaxed, competent, qualified and healthy accepts no responsibility for those drivers.

    The result is a cesspit of cynical, black-hearted greed that treats people like shit and has no respect for laws, regulations or standards. It's all about the crass, ratlike pursuit of cash.

    And as for Uber's seemingly nonsensical valuation? Same problem, really: greed. The investors are *not* hoping that Uber will be an efficient, safe business competing well with others (truly free markets and effective competition does not lead to obscene profits). They're hoping that their bad money will help Uber drive out the good, so that properly licensed, responsible, regulated taxi companies are pushed out and ruined, so that Uber becomes a de facto monopoly. All the billions lost so far are merely a stake in the game, which will be won back when Uber can raise prices as the only game in town.

    And guess what? Even when Uber is a monopoly and using one of their rides costs you more than it ever did ... the drivers will still be paid and treated like shit.

    It surely can't be a surprise, then, that this kind of corporate culture leads to other vile business practices.

    1. ecofeco Silver badge

      Re: It's part of the greed culture

      Exactly. Nailed it.

  14. ecofeco Silver badge

    Sterben, Uber. Sterben already

    Because "die Uber" doesn't translate well.

  15. DesktopGuy

    Wow, these guys are a law unto themselves.

    Lying, corruption, payoffs, sexism (list goes on and on).

    I see a job opening for a certain world leader in the not too distant future…

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