A former executive with Google who went on to work for Uber has filed for Chapter 11 bankruptcy after he was ordered to pay Google $179 million for sharing trade secrets and other contract violations. An arbitration panel hearing the case had recommended an award of $127 million to Google. However, a court added legal fees and interest payments to that amount, increasing it by more than $50 million.
The executive was a leading developer of the technology behind Google’s self-driving vehicles. That division of the company was known as Waymo. According to Google, before he left Waymo to start his own company that made self-driving trucks, he downloaded thousands of files in violation of his employment agreement. His company, named Otto, was purchased by Uber in 2016.
In their lawsuit, Google claimed that the executive was prohibited under his employment agreement from keeping confidential information as well as engaging in “any other employment, occupation or consulting directly related to” work he was doing for Google. They say he also violated other agreements in which he agreed not to “encourage, induce [or] solicit” Google employees to leave.
The executive was fired by Uber in 2017 when he didn’t comply with that company’s internal investigation centering around the Google lawsuit. That lawsuit was settled the following year.
An attorney for the defendant said that he “had no choice but to file for bankruptcy to protect his rights as he pursues the relief he is legally entitled to.” In his bankruptcy filing, he claims that he has between $50 million and $100 million in assets.
The former executive’s legal problems are far from over. He is also facing federal charges — specifically 33 counts of trade secret theft and attempted theft.
Detailed, well-crafted employment agreements, nondisclosure agreements and other contracts can’t guarantee that employees will do the right thing. However, they can make it easier to hold them legally and financially accountable when they don’t.