LDN - Business

Waymo may try to push Uber ex-CEO's buttons in car secrets trial

[February 06, 2018] By Dan Levine and Heather Somerville

SAN FRANCISCO (Reuters) - Uber's ex-Chief Executive Travis Kalanick must subdue his notorious hot-headed demeanor and calmly withstand hostile questioning to appear sympathetic to jurors when he is cross-examined by Alphabet Inc's <GOOGL.O> Waymo as early as Tuesday during a trade-secrets trial, legal experts said.

Waymo sued Uber Technologies Inc a year ago over allegations of theft of self-driving car trade secrets. Waymo said that one of the company's former engineers, Anthony Levandowski, downloaded more than 14,000 confidential files containing designs for autonomous vehicles before he went on to work at Uber, leading the ride-hailing firm's self-driving car unit.

During opening statements in San Francisco federal court on Monday, Waymo attorney Charles Verhoeven attempted to focus the 10-person jury on Kalanick and his famously pugnacious style.

One internal Uber document from April 2016 that Waymo presented in court shows a list of Kalanick's priorities that had been recorded by another executive. Kalanick wanted to use "cheat codes" against competitors, and he declared "the golden time is over. It is war time" and that "going slower is NOT an option anymore," according to the document.

The competitive pressures were so great to develop self-driving cars that Kalanick decided "winning was more important than obeying the law," Verhoeven told the jury.

Uber attorney Bill Carmody said Uber had not cheated and called Waymo's case a "conspiracy" theory that "just doesn't make sense when you get the whole story."

Waymo listed Kalanick fourth on a witness list filed late on Monday, making it likely he will take the witness stand this week. How Kalanick, who was forced out of the job of chief executive in June, portrays himself and tells the story of the company he co-founded will be a critical moment.

Verhoeven questioned Kalanick at a pretrial deposition last year. An experienced intellectual property litigator, Verhoeven counts Google as a longtime client and also represented Samsung against Apple Inc <AAPL.O> in a 2012 trial over smartphone patents. Samsung Electronics Co Ltd <005930.KS> suffered a jury verdict of about $1 billion, but that amount was reduced on appeal.

For Verhoeven, the key will be to get under Kalanick's skin and cause him to become angry and combative, said John Hueston, a former federal prosecutor who cross-examined Enron founder Ken Lay.

Waymo calling Kalanick as one of its own witnesses is a classic strategy, Hueston said, because it allows Waymo to question him first and try to make him uncomfortable from the moment he begins testifying.

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Travis Kalanick addresses a gathering at an event in New Delhi, India, December 16, 2016. REUTERS/Adnan Abidi

Since Kalanick's lawyers likely will have long prepared him to respond to broader accusations from Waymo, Verhoeven could try to aggravate Kalanick by closely probing at smaller details, Hueston said. If Kalanick appears unlikeable and even aggressive, it will reinforce Waymo's argument that winning was more important than honesty at Uber.

For Kalanick, avoiding the temptation to fight Waymo on every minor point will be crucial, Hueston said. By admitting small mistakes, he said, Kalanick will likely elicit more sympathy.

"Jurors will often develop a sense of good guy, bad guy based on how the face of the company does on the stand," said Hueston, who is not involved in the case.

Waymo and Uber declined to comment, and Kalanick's lawyers could not immediately be reached.

Kalanick's testimony is especially important because of how closely he managed Uber during his more than eight years there and molded it in his image before he was forced out by investors who feared his leadership style would hurt the company. It was Kalanick who created Uber's values of "toe-stepping" and "always be hustlin," and through his large stock ownership and voting control determined many of Uber's business decisions.

Kalanick spearheaded Uber's acquisition of Levandowski's startup, a self-driving truck company called Otto, and he famously called Levandowski "a brother from another mother." The two held long private meetings beginning months before the acquisition, according to court filings.

During a pretrial deposition last year, Kalanick said he directed Levandowski not to bring any Waymo technology to Uber, according to a transcript. Levandowski has never publicly addressed the allegations of taking the documents and law enforcement has not charged anyone with their theft.

Waymo has argued that Otto was simply a vehicle for Levandowski to transfer the stolen technology secrets. The company was acquired about seven months after its founding by Uber for $680 million.

In court on Monday, Uber's Carmody said none of Waymo's proprietary information made it to Uber. "Nothing, zero, period," he said.

Kalanick's testimony will be closely watched also because he has not spoken publicly in any material way since his departure from Uber.

(Additional reporting by Alexandria Sage; Editing by Lisa Shumaker)

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