
Judge Tells Uber Lawyer: ‘It Looks Like You Covered This Up’ - Cbasedlifeform
https://www.nytimes.com/2017/11/29/business/waymo-uber-trial.html
======
adjkant
This is frankly incredible the more that comes out. Paying someone 4.5M in 12
months and then saying everything they claimed is false is some Olympic level
gymnastics. I think this level of cover-up is bigger than many reasonable
people who thought Uber was guilty expected.

~~~
nasredin
Nonetheless, Uber paid a $3 million settlement to the lawyer who wrote the
letter in addition to the $4.5 million paid to Mr. Jacobs. As part of the
deal, Mr. Jacobs was kept on as a security consultant, Ms. Padilla testified.
His job: investigating the claims made in the letter his lawyer wrote.

Mr. Jacobs received $2 million up front and was to receive $1 million spread
over 12 months and $1.5 million in stock, also spread out over 12 months.

\---

I think his job is one of those "I can do this job from home" Fightclub type
jobs.

~~~
adambyrtek
So they paid him to investigate claims they argue are baseless? That doesn't
make any sense.

~~~
tptacek
It does not make any sense at all. It does not ring true. It will not ring
true to a jury either.

~~~
user5994461
On the contrary, it's security done right!

There was no evidence of issues, yet they will still have a look to make sure
of it.

~~~
DonHopkins
You seem incredibly biased. Do you have a dog in this battle? Would you mind
revealing your real name and employer, please? Or do you need to stay
anonymous? Your relationship with the facts has a familiar ring to it.
Kellyanne?

~~~
Waterluvian
Maybe I'm missing a joke here but he or she is right. "we have no reason to
believe any of this is true but we will investigate it to be sure" is more
than we expect most companies to do.

That being said I doubt any of us honestly believe those words from Uber.

~~~
DonHopkins
You must be missing something. I think you missed the part about paying the
guy AND his lawyer an enormous pile of money, then continuing to employ the
guy who reported it, and who they're now calling an untrustworthy lying
extortionist.

Those words just don't ring true no matter who they came from, and Uber's
recent pay-off of a hacker who breached their customer data follows the exact
same pattern.

Go back and read the article carefully, please. I'll repeat thisisit's pointed
questions for you to address after you've gotten your head around the facts:

>I am sorry but do you mean companies should pay off a whistle-blower rather
than say - >a. litigate, if the claims are baseless >b. In case the claim has
substance to try and rectify the issue along with responsible disclosure?

After getting your head around all that, do you really think the guy who said
"The fact that two qualified employees, a lawyer and a security constant,
getting a similar sum should hint that it is common." sounds unbiased?

~~~
user5994461
I just wanted to outline that investigating baseless claims if perfectly
normal. How could they even be qualified of baseless fore sure if they were
not investigated?

The payout is a different matter, that we both agree doesn't contribute to
their defense.

------
1024core
_Judge Alsup questioned why Uber would pay so much to an employee making bogus
claims. “To someone like me, an ordinary mortal, and to ordinary mortals out
there in the audience — people don’t pay that kind of money for B.S.,” the
judge said._

 _Uber’s rationale for the settlement: It would cost less to settle with him
than to fight him in court. Also, Mr. Jacobs’s claims could hurt Uber’s
reputation, Ms. Padilla testified._

I guess it's open season at Uber now? All you have to do is send them a letter
with bogus claims, and they'll pay you millions? /s

~~~
Hasz
I love the line about "hurting Uber's reputation", as if they are the sterling
example of honest and ethical company.

~~~
Kalium
To most users in most places, there's nothing particularly notable about Uber.
They have an unsavory reputation if you move in certain rarefied technical or
political circles, but not among the general public. My parents, who are by no
means ignorant or uneducated, would be completely unable to comment on why
Uber might have a bad reputation.

~~~
allenz
It's not just tech circles. Many Lyft drivers tell me that they refuse to
drive for Uber because Uber is not friendly. That's a significant number of
people, more so if you include people they talk to. Word gets out.

~~~
misun78
Drivers drive for the product that provides the most income. Outside of the
realms of SF (and even within), there are only two types of drivers:

1\. Ones who drive for both - this cohort used to prefer Lyft due to tips but
the scales have tipped (no pun) due to Uber introducing a whole host of
features which Lyft is catching up to. This is easily verifiable by
frequenting reddit.com/r/uberdrivers or reddit.com/r/lyft

2\. Ones who only drive for Uber because the demand is overwhelming enough to
not justify managing two separate accounts.

Anything else you hear is pure anecdote. My source - I am an Uber employee :)

~~~
joosters
If you work for Uber, it's not surprising that you only hear from drivers that
do some work for Uber!

------
throw7
"As part of the deal, Mr. Jacobs was kept on as a security consultant, Ms.
Padilla testified. His job: investigating the claims made in the letter his
lawyer wrote."

Is this a joke? Is this real? I can't even.

~~~
jedmeyers
Seems like straight from the Fight Club

"Narrator: I have a better solution: You keep me on the payroll as an outside
consultant and in exchange for my salary, my job will be never to tell people
these things that I know. "

~~~
magnetic
I think this is the scene:
[https://www.youtube.com/watch?v=6pJC0FLA3Sk](https://www.youtube.com/watch?v=6pJC0FLA3Sk)

------
thisisit
Seems Uber's solution to every problem - throw money and see it disappear. If
it comes back say - well that was not the intention.

Threatens to become a whistle blower? Pay the guy 4.5 million and his lawyer 3
million.

Stolen data? Pay the hacker to delete data.

~~~
make3
I mean, in the case of the whistleblower, I'm not sure what you do in this
case if you're them aside from this. Which is why there should be a law
against this type of behavior. There probably is; I'm a programmer, not a
lawyer

~~~
thisisit
I am sorry but do you mean companies should pay off a whistle-blower rather
than say -

a. litigate, if the claims are baseless

b. In case the claim has substance to try and rectify the issue along with
responsible disclosure?

~~~
make3
if you have reason to think that praying off the guy will work during a huge
public image crisis, it would be a very attractive option I'm sure.

they should act morally, etc., that's not what I'm saying. I'm trying to
extract the raw incentives of the situation

~~~
woodandsteel
No, that would just signal that other employees could earn a huge amount of
money by making claims about illegal activity, true or not. I really doubt
that any company could be so stupid as to get itself into that sort of
situation.

------
mcguire
" _She said Uber had planned to fire Mr. Jacobs because its security team had
caught him downloading sensitive company information to his personal
computer._ "

Well, I guess they'd know how bad that was.

~~~
bitmapbrother
I would have thought downloading sensitive company information to a personal
computer would have been a requirement for employment at Uber.

~~~
TallGuyShort
Are you perhaps confusing personal computer as in "a small individual
workstation" with personal computer as in "a computer not managed by the
company's IT policies"? I have to download sensitive stuff to my laptop all
the time, but it's a laptop I'm given a computer by IT that has to be secured
a certain way and connected to their network. They don't want me having
customer details or anything on an actual personally-owned computer.

~~~
hirsin
Pretty sure that was a riff on their employee stealing data from Waymo via
personal laptop.

------
gpm
For anyone interested in reading more about this. You can see the docket, and
a lot of the original filings for this case for free via the RECAP project.

[https://www.courtlistener.com/docket/4609586/waymo-llc-v-
ube...](https://www.courtlistener.com/docket/4609586/waymo-llc-v-uber-
technologies-
inc/?filed_after=&filed_before=&entry_gte=&entry_lte=&order_by=desc)

------
altern8tif
I'll be damned if Uber isn't a required case study for business school
students in the (near) future. They are fast becoming the Enron of this
generation.

~~~
bob_theslob646
Not even close to the scale of Enron. Even mentioning them in the same
sentence is preposterous.

First off, Enron was publicly traded. Uber is private.

I will just leave this here.

>Between 1996 and 2000, Enron's revenues increased by more than 750%, rising
from $13.3 billion in 1996 to $100.8 billion in 2000. This extensive expansion
of 65% per year was unprecedented in any industry, including the energy
industry which typically considered growth of 2–3% per year to be respectable.
For just the first nine months of 2001, Enron reported $138.7 billion in
revenues, which placed the company at the sixth position on the Fortune Global
500

>the company used accounting limitations to misrepresent earnings and modify
the balance sheet to indicate favorable performance

~~~
euyyn
I'm baffled: If you're going to make up your numbers, why go with something
preposterous instead of credible?

~~~
emodendroket
It seems like in a lot of these cases, there are plenty of parties who can
intuit that something is wrong, but they choose not to dig any deeper because
they're happy with the results of the way things are.

~~~
Twirrim
I wouldn't be surprised if ego entered in to it a little too on the not
digging deeper side. "Clearly everyone else in the industry are idiots, or
they'd be as profitable as we are".

~~~
emodendroket
I just think back to some of the stuff I listened to about the Bernie Madoff
case where they were saying, essentially, that a lot of the bigger
institutions bringing him clients had to have known something was up with the
numbers, but they chose not to understand because they were making money and
didn't want to rock the boat.

------
Hupriene
If Uber is found to have stolen trade secrets, how large is the judgment
against them likely to be? Is it based on some multiple of the cost of the
research that produced those secrets? Or the market value of those secrets?

~~~
fixermark
I'm not a lawyer, but I was under the impression that the worst thing that
could happen would be that Uber would be forbidden from using the stolen
technology or its fruits.

... which would basically be akin to telling them "Get out of the self-driving
vehicle business."

~~~
mikejb
That is the worst that can come out of this case - and it would be a critical
hit for Uber. Self-driving _will_ be a big aspect of the future (how long that
future's away is a different discussion), but once self-driving cars are here,
what would Uber's business be? Kalanick himself said this:

"If we are not tied for first, then the person who is in first, or the entity
that's in first, then rolls out a ride-sharing network that is far cheaper or
far higher-quality than Uber's, then Uber is no longer a thing"

OTOH, Alsup (the judge in this case) recommended to look into a criminal
investigation against Uber, which seems to be in progress considering that is
what lead to the Jacob's letter in Alsup's hands. That potential investigation
could have worse impact than just "don't do self-driving cars". Depending on
the verdict, it could lead to anything between nothing to prison time for
numerous executives to the point that the company itself would struggle to
survive.

~~~
pitaj
> struggle to survive

it probably would result in Uber being acquired

------
partycoder
Uber business model is:

\- Make money willfully violating the law

\- Use a portion of the money to pay fines, settlements, cover ups. Keep
violating the law

That's how they expanded to many countries before they were even authorized.

~~~
fstuff
You missed a couple steps

\- hire a PR firm to flood new cities with stories of how g great uber is

\- build up a huge rider and driver base by offering riders deep discounts and
drivers big bonuses

\- when threaten with regulations email the user base asking them to contact
city officials because regulators are stifling innovation and limiting
consumer choice... asnd throw in a line about taxis being old and crappy. They
did this exactly when it wad announced London banned them.

~~~
londons_explore
Successfully. They're still operating in London.

~~~
likelynew
What. I didn't know that.

------
HelloNurse
Does Uber risk losing the Waymo trial by default, and not only suffering
sanctions along the way, because of this evidence tampering?

~~~
londons_explore
My understanding is that this kind of hiding evidence and tampering would not
be punished in the current trial. Instead, if it was determined to be criminal
behaviour, there would be another follow up criminal trial.

~~~
wglb
Consider the possibility that the fact that they concealed evidence would be
highlighted by the judge to the jury. Thus they may well be punished for it in
the current trial.

------
abvdasker
Headline is pretty misleading. The full quote is "On the surface it looks like
you covered this up"

~~~
adjkant
If anything the headline is misleading in the other direction. The details in
this are pretty damning:

1\. Paid an employee 4.5M after sending accusatory email to CEO

2\. Levandowski used Wickr for an unknown purpose, an app no longer used
within the company

3\. Said email to CEO hidden from discovery during trial

None of this is 100% proof, but the body of evidence that is growing makes it
harder and harder to reasonably believe that Uber is innocent here.

That said yes the quote as stated is misleading of what Alsup actually said. I
just wish the headline was about the points above, not his quote.

~~~
dmix
You can twist a narrative about using an app with 'self-destructing messages'
to sound like a malicious act but what's stopping any individual or company
from wanting privacy? Wickr is a very popular app, especially among
technically-savvy people.

With widespread surveillance and hacking there are a hundred other reasons
besides hiding evidence from an IP trial for using an app like that.

Uber's claims the letter from the security employee, who highlighted the use
of 'special laptops' and self-destruction messaging apps, was of an
'extortionist' nature and led to him getting a payout. Calling that employee a
'whistleblower' is another potential spin.

Which is why that statement rightfully includes "On the surface...".

Paying off someone is far more directly relevant but again there is a
presumption of innocence for very good reasons. And I don't think we should
ignore that

~~~
gpm
You can't accuse GP of twisting the 'self destructing message' app thing when
the original source says it was for malicious purposes (you could arguably
accuse the original source, except...). I'm also highly skeptical that it is
at all legal to use such an app for communications you are legally required to
preserve because you are aware of the possibility of a lawsuit.

> Jacobs: Uber's use of encrypted ephemeral systems was dessigned to protect
> sensitive info and ensure we didn’t create a paper trail that wd come back
> to haunt the co in any potential civil or criminal investigation. [0]

> Judge quotes Jacob's atty letter: Uber employees went to Pittsburgh to
> educate the AV group about ephemeral, encrypted communications "to prevent
> Uber's unlawful schemes from seeing the light of day" [1]

[0]
[https://twitter.com/CSaid/status/935555627815813120](https://twitter.com/CSaid/status/935555627815813120)

[1]
[https://twitter.com/CSaid/status/935569588309327878](https://twitter.com/CSaid/status/935569588309327878)

~~~
dmix
The Jacob person you're quoting was demanding money to not expose such
information in an 'extortionist' style attempt... and he did take the money
and he did keep quiet. He wasn't some good-guy whistleblower, he took
advantage of his inside knowledge after he was fired for personal gain. While
then rejoining Uber after the fact and continuing to work there.

In that letter, likely written by his attorney who also got $3 million, had a
clear incentive to twist the narrative of using an app like Wickr to make it
seem as malicious and damaging as possible.

Uber also went to federal prosecutors with his letter to preempt him from
using it for further personal gain. They didn't try to hide from it.

I'm not saying it wasn't used for malicious purposes but I'd take those
allegations in the letter with a grain of salt.

~~~
bob_theslob646
>I'm not saying it wasn't used for malicious purposes but I'd take those
allegations in the letter with a grain of salt.

Seriously? What ever happened to due process?

------
apeace
> Thirty-seven pages long, it detailed a list of questionable behavior at
> Uber, including spying on competitors and using special laptop computers and
> self-destructing messaging apps that would hide communications.

It doesn't seem like a good thing that using self-destructing messaging apps
is considered by our court system to be "questionable behavior". It is akin to
the argument that using encryption implies guilt.

~~~
btian
> akin to the argument that using encryption...

That's quite a stretch.

If you read the document, it says they use self-destructing apps to not leave
paper trail.

That is akin to saying you used encryption so that DEA won't catch you selling
drugs.

------
MertsA
>The letter is sealed but the judge said he intends to make it public after
hearing any objections.

I love this, not only do we get to read the letter, we also get to read Uber's
transparent objections beforehand.

------
puppetmaster400
I know of one case where after a subpoena and request for evidence: hard
drives were wiped clean and mobile devices were destroyed with a hammer. We
can't have it both ways, can we?

------
paul7986
I believe Uber was hacked years ago and knew about it yet did nothing but
blame it's users for using a bad password.

Case in point in 2014 1K was stolen from my bank account via my Uber account
for a ride in London(im in DC). I searched Twitter and saw 10 to 20 ppl a day
complaining about the same thing.

~~~
emodendroket
Did you have your bank account linked to Uber? Is this a common thing to do?

~~~
paul7986
PayPal

------
kleiba
What's an "intellectual-theft trial"?

~~~
Whitestrake
Would a trial to determine theft of property normally be called a "theft
trial"?

I assumed that if that were the case, it would follow logically that an
"intellectual theft trial" would be a trial to determine theft of intellectual
property. I suppose it might be strange if the former is not common
vernacular.

~~~
emodendroket
It would be more likely to use the actual crime someone was charged with
(e.g., "robbery trial," "larceny trial," etc.) and I think it's rare for legal
statutes to have a crime called "theft." But otherwise the form seems normal.

------
Anil-Shrestha
And Anthony Levandowski will walk a free man?

~~~
woodandsteel
Probably not, since he is being investigated by federal prosecutors for
criminal behavior.

------
ryguytilidie
It seems like the "well, all startups do bad things, Uber is just in the
spotlight" crowd has dried up a bit...

~~~
notheguyouthink
It's always sort of nuts to me how often that excuse comes out for nearly
everything. Politics especially. We find out one government official is doing
something bad and the response for those on that side of the party line is
"everyone does it, don't single this person out!"

Perhaps I'm just being overly purist, but I always want to hang them _(not
literally)_ _AND_ try to solve the problem. In this case, if it's true than we
clearly need more oversight on startups/companies, and we also need to
prosecute Uber.

~~~
pm90
No its not being a purist at all. Legally, the law doesn't recognize any
whataboutism whatsoever (unless its in the specific sense of legal
precedents). So you can't argue your innocence in a bank robbery just because
another gang also robbed a bank but did not get convicted.

The law is pretty clear; its just that most people are not prosecuted for it.

~~~
moomin
There's selective prosecution, but I take your point.

~~~
vkou
Unfortunately, when law is enforced sufficiently selectively, you do not have
rule of law, nor do you live in a nation of laws.

Saying that the law does not recognize whataboutism is a red herring (Unless
we are talking about the outcome of a specific legal case).

In short, whataboutism is a legitimate argument for why someone should not be
prosecuted (Because the law has nothing to do with that decision.)

------
karmapolic
when is the Uber exodus going to start?

~~~
fstuff
I think it'll be exodus 2.0. I contracted there until Nov 2016, a few months
before the delete uber campaign and Susan Fowler. I kept in contact with some
service desk friends and they said after Susan's blog at least 200 people quit
right after. Again this is just anecdotal hearsay but I was told another 500
people left a few months later after they collected their yearly bonuses.
After bonuses he said maybe 10 to 15 people per week were stopping by the
support bar to turn in their laptops on their last day in his building alone.
His guess was that at least 800 to 1000 people quit in the first six months of
the year. I haven't spoken to him since the end of summer so I don't know how
their policy changes, pay bumps, and CEO/ leadership have changed things and
if the attrition number slowed. But with this recent news I think this could
kick off exodus 2.0.

------
KKKKkkkk1
I don't want to defend Uber here, but I don't see what this letter business
has to do with Waymo's allegedly stolen LIDAR. Why should Uber have disclosed
this letter to Waymo?

Also, I don't see what's the legal problem with spying on your competitors. I
mean, Google and Facebook are spying on their customers, and the law
apparently has no problem with that.

~~~
jhall1468
> Also, I don't see what's the legal problem with spying on your competitors.
> I mean, Google and Facebook are spying on their customers, and the law
> apparently has no problem with that.

It's not spying, it's doing so illegally. Facebook and Google don't do that.
The letter accuses Uber of doing just that, and that's pretty damned relevant
in a case where Uber stole trade secrets.

~~~
malandrew
“I did not believe it was patently illegal,” Jacobs said. “I had questions
about the ethics of it. I suppose because of my personal ethics it felt overly
aggressive and invasive.”

ref: [https://www.bloomberg.com/news/articles/2017-11-28/waymo-
tri...](https://www.bloomberg.com/news/articles/2017-11-28/waymo-trial-
delayed-again-with-sharp-words-for-uber-from-judge)

~~~
jhall1468
He's not a lawyer. The question is a question to debate legally. When
something is questionably ethical, whether or not it's legal is dependent on
the outcome of a trial.

An employee was accusing them of doing something highly unethical and
potentially illegal regarding information about competitors. Again, that's
incredibly relevant.

