• Former Google self-driving engineer Anthony Levandowski has been indicted on 33 counts of trade secret theft.
  • Levandowski has been accused of stealing 14,000 confidential files from Google’s Waymo self-driving division before leaving the company and selling his own self-driving startup to Uber, with very similar lidar designs to those at Waymo.
  • Much of the engineering IP in question deals with lidar, a sensor that many experts in the field consider essential to winning the autonomous vehicles arms race.

If you’ve ever seen a self-driving car in real life, driving maddeningly slow and usually with two humans in the front seats, you’ve likely also noticed that weird spinning top on the roof of the car that sort of resembles a big container of Maxwell House coffee.

That’s actually a laser, and the sensor’s engineering secrets have been at the heart of a bitter war between Google and Uber’s self-driving outfits for nearly three years. The two companies, as well as some of the other biggest names in in Silicon Valley, are fighting over lidar and some yet-to-be patented technology surrounding that sensor. (AKA, trade secrets).

And now a major shoe has dropped: On Tuesday afternoon, self-driving car engineer Anthony Levandowski was arrested and charged by federal authorities with 33 counts of trade-secret theft, according to a criminal complaint.

Levandowski’s alleged cardinal sin was transferring some of Google’s engineering files, including those on lidar, to his personal laptop—unauthorized—according to the complaint. Levandowki had left Google’s Waymo and shortly thereafter joined Uber as lead engineer when the San Francisco-based ride-hailing firm bought Otto, his self-driving truck startup that he’d been working on since leaving Waymo.

Eventually, when the lawsuit came to the forefront, Uber fired Levandowski in May 2017.

Levandowski is known for being a star engineer at both Google and Uber, where he led much of the autonomous engineering division. At Google, Levandowski focused on the company’s Street View application and founded a mobile mapping startup, 510 Systems, that experimented with—you guessed it—lidar.

In 2016, Uber acquired Otto and brought Levandowski on board. As the story goes, that’s when he brought the 14,000 confidential files from Google to Uber, vis-a-vis Otto.

By February 2017, Waymo filed a lawsuit against Levandowski for allegedly downloading 9.7 gigabytes of the company’s confidential files. All was quiet on the western front for a while, until Tuesday’s news of his indictment hit.

Levandowski’s arrest should send two warning signs to the self-driving industry:

1) When you’re trading talent back-and-forth between firms like a game of hot potato, you need to lock down your trade secrets as tightly as possible, even among employees—especially those that don’t require access to that particular engineering information.

2.) Maybe, just maybe, filing for patents is a better strategy than trusting your engineers not to spill the beans when the stakes are so high.

Besides lidar, some of the other allegedly stolen intellectual property included private schematics for proprietary circuit boards that are used in self-driving cars, according to the complaint.

Lidar, which is a central sensor in autonomous car perception, can cost up to $75,000 off-the-shelf, so companies like Waymo have created their own versions to cut costs. That expensive tech typically comes from Velodyne, the top manufacturer of commercially sold lidar, and you’ll often notice those sensors on autonomous robots, as well.

Waymo, founded in 2009, had long been developing in-house lidar technology to bring down costs. And as one of the earlier entrants to the self-driving race, it had a head start on other firms.

Meanwhile, competitors like Pittsburgh-based Argo AI and Aurora Innovation have been gobbling up smaller lidar startups through acquisitions, like New Jersey’s Princeton Lightwave and Montana’s Blackmore, respectively.

These firms recognized just how hard it is to engineer the perfect lidar system quickly and efficiently in house. Without stealing. There are patents to prove it.

Here’s where it gets even more complicated and bizarre: An engineer with no connection to either Google or Uber has spent $6,000 of his own money to stop Waymo from patenting key technology to its in-house lidar.

After that engineer, Eric Swildens, took his complaint to the U.S. Patent and Trademark Office, the judge rejected 53 of 56 claims in Waymo’s 936 patent, dealing with a particular lidar circuit in the system.

Why the rejections? Well, Swildens just “couldn’t imagine the [lidar] circuit [described in the 936 patent] didn’t exist prior,” according to Ars Technica.

Patent 936 (check out additional technical details here) has been central to the lawsuit between Waymo and Uber, which dates back to December 2016.

After Levandowski joined Uber, Waymo first began accusing its former employee of infringing on its lidar design patents and using intellectual property he had allegedly stolen. Eventually, Uber acquiesced and agreed to stop using Waymo’s technology in its own lidar development. In return, Uber agreed to redesign its lidar and pay out $245 million in equity to Waymo to close the lawsuit.

In theory, Velodyne could now accuse Waymo of infringing on its own 558 patent, based on the Uber-Waymo ruling. But it turns out that protecting lidar intellectual property is a chaotic process.

Velodyne has already defended and won a challenge against patent 558, which deals with a lidar-based 3D point cloud for measuring systems used for autonomous vehicles, robotic computer vision, and more. The suit was brought by a small startup called Quanergy, a Sunnyvale, California-based sensor company.

This pickpocketing and spit-swapping of central intellectual property is a huge risk to not only autonomous vehicles firms, whose employees tend to hop from job to job, but it also impacts all sectors of technology where high-stakes intellectual property could be at risk.

“The Bay Area has the best and brightest engineers, and they take big risks,” John Bennett, the FBI special agent in charge of the San Francisco Division, said at a news conference on Tuesday.

“But Silicon Valley is not the wild West. The fast-paced and competitive environment does not mean federal laws do not apply.”

So, dear engineers: Maybe just build or buy that lidar tech yourself.

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