Uber facing federal probe on allegations of espionage

SAN FRANCISCO: Federal prosecutors are investigating allegations that Uber deployed an espionage team to plunder trade secrets from its rivals. The revelation triggered a delay in a high-profile trial over whether the beleaguered ride-hailing service stole self-driving car technology from a Google spinoff.

The probe under way at the US Justice Department centres on a 37-page letter that described allegations made by Richard Jacobs, Uber’s former manager of global intelligence.

Jacobs had the letter sent in May to an Uber lawyer. The letter contended that Jacobs had been wrongfully demoted and then fired for trying to stop the company’s alleged misconduct.

The investigation hadn’t been publicly known until Tuesday, when it surfaced in a court hearing that was supposed to set the stage for a trial pitting Uber against Waymo, a self-driving car pioneer that started within Google eight years ago.

The hearing instead quickly turned into a forum raising more questions about Uber’s ethics and corporate culture.

Over the past year, Uber has been rocked by revelations of rampant sexual harassment inside the company, technological trickery designed to thwart regulators and a year-long cover-up of a hacking attack that stole the personal information of 57 million passengers and 600,000 drivers.

Jacobs, whose lawyer wrote the letter at the centre of the courtroom drama, testified on Tuesday that Uber had set up a unit called Marketplace Analytics to steal trade secrets from its rivals overseas. He didn’t specify which competitors Uber had targeted.

His allegations had been kept under wraps until the Justice Department passed them along to US District Judge William Alsup last week.

In an unusual move, Alsup had recommended in May that the Justice Department open a criminal investigation into Uber, based on the evidence he had heard in the Waymo case.

In a statement defending itself, Uber pointed to Jacobs’ testimony that he wasn’t aware of the company stealing any of Waymo’s trade secrets. “None of the testimony (Tuesday) changes the merits of the case,” Uber said.

In its statement, Waymo called the latest allegations against Uber “significant and troubling”.

Alsup postponed the scheduled Dec 4 start of the Waymo-Uber trial to give Waymo more time to gather evidence. He didn’t immediately set a new trial date.