Uber, Waymo reach $245 million settlement in trade secrets lawsuit

SAN FRANCISCO (KGO) -- A surprise settlement was announced Friday morning in the high-profile lawsuit between Uber and Waymo, which is part of Google's parent company.

The deal ends a contentious trial about the technology behind self-driving cars, and also about the culture and hiring practices of Silicon Valley.

"I was shocked, I was very shocked," said CNET News reporter Dara Kerr, who was just settling into the courtroom for what was scheduled to be hours of tech-heavy testimony. "Waymo's lawyer got up and said that they had reached a settlement, an audible gasp went through the courtroom."

The settlement has Uber paying Waymo about $245 million worth of equity, and pledging not to use Waymo's confidential information.

RELATED: Uber-Waymo trial could change how Silicon Valley does business

"This lawsuit really was about allegedly stolen trade secrets," Kerr said.

Those alleged secrets came from Google's self-driving car project, which later became Waymo. Waymo's lawyers argued that engineer Anthony Levandowski copied 14,000 files before leaving Google to found a startup, Otto, that was quickly acquired by Uber. But intellectual property attorney Mike Keyes said it's not about the files.

"Someone could have information in their head, but that could still be considered a trade secret," he said.

And that's where things get messy. Tech companies want to recruit the best talent, but Keyes says the line between talent and inside information remains a very blurry one.

"You're gonna have certain know-how that an employee gathers at the prior place of employment," he said. "I mean, that's in fact why you want that particular employee to come."

That and many other questions about stolen secrets could now go unanswered in light of the settlement. But the testimony did answer other questions, like those about what went on inside Uber during a time filled with controversy.

"Travis' testimony was really interesting," Kerr said.

Uber founder Travis Kalanick took the stand on the second day of testimony and spoke under oath, "about the inside story of Uber's 'bro culture,'" Kerr said.

"Travis would say things like, 'second place is first loser,' and 'the golden time is over, it's wartime,'" she said.

In a statement after the settlement, Kalanick said, "had the trial proceeded to its conclusion, it's clear Uber would have prevailed."

In the company's official statement, Uber's new CEO said, "we do not believe that any trade secrets made their way from Waymo to Uber ... We agree that Uber's acquisition of Otto could and should have been handled differently."

Waymo said it's pleased with the settlement, and wrote, "we are committed to working with Uber to make sure that each company develops its own technology."

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