Inside the Uber and Google Settlement with Anthony Levandowski – TechCrunch


One of Silicon Valley’s most infamous characters have narrowly avoided – yet again – the worst consequences of his actions.

Anthony Levandowski reached a settlement agreement last week that resolves a number of disputes with his two former employers Uber and Google and ends one of the most dramatic and complicated storylines in the self-driving vehicle industry.

Levandowski, an early pioneer in the audiovisual industry, left Google and started his own company Otto, which was quickly acquired by Uber in 2016. The acquisition would lead to a trade secret theft lawsuit against Waymo (the Google’s former self-driving project) to Uber. Levandowski would ultimately lose his job at Uber and face criminal charges and a civil suit. The final piece in this multi-year legal drama finally seems resolved.

Under the agreement, Uber will pay Google a “substantial portion” of the $179 million it was awarded in arbitration in 2019, which caused Levandowski to file for bankruptcy. Uber will also pay Levandowski $2 million. A court filing notes that Levandowski’s financial adviser believes the settlement agreement will give him enough money to pay all claims against him.

The settlement avoids a potentially embarrassing lawsuit for Uber and could also mark the beginning of the end of Levandowski’s bankruptcy proceedings. In keeping with Levadowski’s dramatic journey in the self-driving world, his legal affairs have seen many twists and turns.

If the deal is approved by the court, it would be a triumph for Levandowski, who faced financial ruin, and an 18-month federal prison sentence after pleading guilty to a single count of theft of trade secrets. to Google. Levandowski was pardoned in January 2021 at the 11th hour by incumbent President Trump.

Uber does not pay Google the full $179 million reward; the exact figure has been redacted in the filings and is protected by a confidentiality clause.

However, the physical size of the redacted figure suggests it is less than $100 million.

Picture credits: Screenshot/court document

Regardless of the exact amount, other creditors in Levandowski’s bankruptcy can either take the same proportion of their claim that Uber is paying Google’s, plus a few additional payments if there’s money left over. Or they can take 50% in one final payment. It would only be a rational choice if Uber’s initial payment is less than half of what Google was owed.

“Peace between these critical constituencies ensures that ongoing litigation over these disputes, and the associated risks and expense, will cease,” the three parties wrote in a filing.

Remarkably, Levandowski even appears to have been able to convince Uber and Google to help pay for the deal that freed him. A clause of it notes: “The parties hereto will stipulate acceptance of an administrative claim by Levandowski, personally, for payment of attorneys’ fees in the negotiation of this term sheet in an amount not not exceeding $30,000 (which amount is exclusive of the $25,000 previously advanced).

Uber was potentially liable for the Google price because it signed an indemnification agreement with Levandowski when the ride-sharing giant acquired its self-driving truck startup Otto in 2016. The agreement provided legal cover for Levandowski for his actions during and after his job on Google’s Chauffeur self-driving vehicle program, which later morphed into Waymo.

These were later discovered to include starting a rival lidar business at Google, deleting technical data from the company, and courting a number of Google engineers to do defection with him. Uber paid much of Levandowski’s legal costs in his criminal trial, but complied with the arbitration award, which recovered the roughly $120 million Levandowski had won at Google, plus interest and attorney’s fees. .

Uber alleged that Levandowski failed to share all of his “bad deeds” before joining the company, which could have invalidated the deal. Levandowski, for his part, claimed that Uber knew he had withheld large amounts of technical information and asked Googlers to leave with him, and compensated him anyway.

A trial to decide Uber’s liability was due to begin in San Francisco today, with Levandowski planning to call high-profile witnesses, including Uber founder Travis Kalanick and its former self-driving chief, today CEO of Carnegie Robotics, John Bares.

The bankruptcy case was not without its own revelations. Court documents show that in the run-up to filing for bankruptcy, Levandowski bought his fiancée a $25,000 engagement ring, invested $250,000 in her business, gave her a $130,000 Tesla and paid her over $300,000. He has also invested more than $8.5 million in his new self-driving truck startup, Pronto.ai. The filings detail Levandowski’s vast holdings in real estate, investment funds and businesses with family members.

On several occasions, Google’s attorneys worked effectively with those of Levandowski, as his success in holding Uber liable for the arbitration award appeared to represent the company’s best hope of getting paid.

The settlement agreement now calls for Levandowski’s estate to make its own payments to Google, amounting to at least $25 million, and up to $30 million if there are sufficient funds. . Levandowski must also “represent and warrant” that he has no longer provided any Google secrets or confidential information to anyone, and in particular to “Pronto.ai or any entity related to Pronto.ai”.

Pronto.ai recently announced a pivot towards the development of a cryptocurrency-powered peer-to-peer telecommunications network, called Pollen. Pollen’s website shows his initial version of devices sold out, Levandowski’s brother Max (who worked with him at Otto, Uber and Pronto.ai) said on LinkedIn that a new version of the hardware is planned .

Uber did not immediately respond to requests for comment on the settlement agreement. Google spokesperson José Castañeda wrote, “We can confirm that this matter has been resolved.”

Levandowski also didn’t respond to messages, but it’s hard to see the deal as anything more than a win for the engineer, who may soon be free to move forward with his Pollen Network without being encumbered with costly and time-consuming lawsuits and unpaid debts.

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