Blog Tesla Accuses Rivian of Poaching Employees, Stealing Trade Secrets

Tesla says in a lawsuit that electric vehicle startup Rivian poached employees and stole confidential information.

The suit says Rivian’s team includes 178 ex-Tesla employees, 70 of whom came directly from Tesla. Tesla says in the suit that four former Tesla employees are responsible for taking confidential information to Rivian – Tami Pascale, Kim Wong, Jessica Siron and Carrington Bradley.

“Rivian is knowingly encouraging the misappropriation of Tesla’s trade secret, confidential, and proprietary information by Tesla employees that Rivian hires,” the suit says.

Rivian announced earlier this month that it has closed a massive $2.5 billion round of funding led by funds and accounts advised by T. Rowe Price Associates. The company has raised nearly $6 billion, including strategic capital from companies like Ford, Amazon, and Cox Automotive in 2019.

Rivian is set to start production next year on its all-electric R1T pickup and R1S sport utility vehicle. The company is also developing an electric delivery van for Amazon utilizing Rivian’s skateboard platform. A total of 100,000 vans were ordered with the first deliveries expected next year.

Tesla has previously sued former employees, alleging they took trade secrets to  China’s Xpeng Motors and Silicon Valley-based Zoox Inc. Tesla also filed a suit in 2017 against a former employee it said took self-driving tech secrets to co-found autonomous driving start-up Aurora. Aurora later settled.

In a statement to Bloomberg, Rivian said the lawsuit is baseless and “counter to Rivian’s culture, ethos and corporate policies.”

 

[pongajim]

When you take your employer's stuff with you and they find out...you'll never work in the business again...maybe any business except Starbucks...

 

[Bill Price]

Maybe it's just me? But if you had key employees with proprietary information working for you and you knew there were competitors trying to woo them, wouldn't you have them sign a non-compete clause?

 

[loganwatson]

Maybe it's just me? But if you had key employees with proprietary information working for you and you knew there were competitors trying to woo them, wouldn't you have them sign a non-compete clause?

It would have been signed. Hence what gives them the ability to sue.

 

[Bill Price]

It would have been signed. Hence what gives them the ability to sue.

It's possible that could be wishful thinking?

 

[loganwatson]

It's possible that could be wishful thinking?

No, Tesla has non-competes. I’m not sure when these people left Tesla but they could fall outside the non-compete. Non-competes are often meaningless to be honest. There’s many loop holes usually.

 

[msm859]

No, Tesla has non-competes. I’m not sure when these people left Tesla but they could fall outside the non-compete. Non-competes are often meaningless to be honest. There’s many loop holes usually.

Not true. As long as they are reasonable in scope and time they are perfectly legal and binding.

 

[oncedrunk]

A non compete would stop someone from working for a competitor but has nothing to do with disclosure of trade secrets. Non competes are marginally enforceable as courts will lean towards allowing former employees to make a living. Non competes also have to be limited to a certain geographic area.

Tesla may also have non disclosure agreements with key development staff regarding trade secrets.

Non competes and non disclosures are enforceable against the former employees.

Aside from than Tesla may sue competitors who target their employees for hire or encourage them to share trade secrets. There can potentially be industrial espionage criminal charges.

 

[oncedrunk]

A non compete would stop someone from working for a competitor but has nothing to do with disclosure of trade secrets. Non competes are marginally enforceable as courts will lean towards allowing former employees to make a living. Non competes also have to be limited to a certain geographic area.

Tesla may also have non disclosure agreements with key development staff regarding trade secrets.

Non competes and non disclosures are enforceable against the former employees.

Aside from than Tesla may sue competitors who target their employees for hire or encourage them to share trade secrets. There can potentially be industrial espionage criminal charges.

Anything Tesla does will not get the secrets back but will only discourage other employees to do the same. You cannot unring a bell.

 

[ApyoPrez]

Tesla says in a lawsuit that electric vehicle startup Rivian poached employees and stole confidential information. The suit says Rivian’s team includes 178 ex-Tesla employees, 70 of whom came directly from Tesla. Tesla says in the suit that four former Tesla employees are responsible for taking confidential information to Rivian – Tami Pascale, Kim Wong, Jessica...

First let me preference that It's not right to steal anything including confidential information. It's also a slippery slope because I am a ex-employee of Tesla and other tech companies and over the past few years Tesla has a documented history of downsizing staff to make it's numbers.
If there are skills and best practices that you learned and developed over time and bought those to Tesla then you are doing the same thing and Tesla wins. It is also your responsibility to perform the duties of your role to the best of your abilities, whoever your employer might be.

Once again a NDA has a place, but you cannot deny a person from making a living regardless where those skills were developed or gained.

 

[Jjmboni]

Here's a good example of a loophole in Oregon:

Other existing limitations under ORS 653.295 include the following: The longest enforceable period of a noncompetition agreement under ORS 653.295 is 18 months from the date of separation, and a noncompetition agreement is enforceable only against (1) employees exempt from minimum wage and overtime under Oregon law (e.g., managerial, executive, salaried employees); (2) employees who have access to a “protectable interest” of the employer (e.g., access to trade secrets or competitively sensitive commercial information); and (3) employees whose annual salary and commissions, at the time of their separation, exceed the median income for a family of four, as determined by the U.S. Census Bureau.
​

I used that to get out of the ridiculous non compete my contracting company made me sign and tried to use against me when I went to another contracting company (that paid better).

If California has a similar law, and if the Tesla employees were not compensated well enough, then they may be able to get out of non-compete at least. I'll bet Tesla isn't only going to use non-competes though. They'll probably try for theft of trade secrets or something like that.

 

[RichNot]

Courts have been reluctant to enforce non-compete agreements against individual former employees, because the former employee would be unable to pursue a career using the knowledge and skills they gained in previous jobs. Otherwise, you have large companies with vast resources trying to block an individual person from having a career based on their working experience. But I do think Tesla could prevent them from sharing trade secretes and patented processes.

 

[CyberGus]

I think Sandy Munro has outed more of Tesla's technology than Rivian's spies ever will.

 

[AmpedRealtor]

This lawsuit is a clear indication that Musk is terrified of Rivian. And he should be. Nothing Musk or Tesla can do will derail Rivian from its mission, especially with the billions it has received from Amazon, Ford, and others. This company is doing things much better than Tesla, which no other vehicle manufacturer wants to invest in or do business with.

Cybertruck is for the Tesla fanboys. Rivian is for real people, who do real work, and need a real truck.

 

[BlackPantherM3]

Why does Tesla lose so many valuable employees? It’s time for Tesla to have a real CEO and let Elon Musk go to chase his girlfriends in Hollywood.

 

[Jjmboni]

Rivian is for real people, who do real work, and need a real truck.

...and they need it ten years from now...

 

[Brando]

Trade Secrets: What You Need to Know

Coca-Cola’s secret formula. McDonalds’ special sauce. Google’s search algorithm. Bumble’s dating software. This proprietary information is vital to these companies’ survival, and among their most valuable corporate assets. Each is protected as a trade secret. While patent law offers strong...

www.natlawreview.com

You might have guessed - from a google search. This article seems a fine intro to "trade secrets" check it out.

 

[million_miles]

What happens? I thought everyone is drooling of working for Elon.

 

[Zorg]

I thought that non competes are unenforceable in CA, which is why people move around so freely between tech companies. Obviously, stealing trade secrets is still a crime.