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Tesla files lawsuit against electric truck startup Rivian

Posted by William J. Cook | Aug 31, 2020 | 0 Comments

Tesla recently accused Rivan, a manufacturer of electric trucks, of stealing employees and trade secrets. How a trade secret is defined and protected by law varies from state to state. In Florida, trade secrets are protected by the Florida Trade Secrets Act.

Tesla maintains that Rivan, a new startup in the electric vehicle space that was heavily backed by venture capitalists, has knowingly misappropriated its trade secrets by hiring 178 former Tesla employees and encouraging them to talk about the projects they worked on at their former employer. A Rivian spokesperson claims that the lawsuit, which was filed in July, is “baseless.”

The legal action could have serious ramifications as Rivian raised $2.5 billion in new funding in July. Rivian is slated to make 100,000 electric delivery vans for Amazon. Tesla is also looking to enter the delivery industry with its Cybertruck venture.

What is misappropriation?

In Florida, the statute defines misappropriation with a couple of different scenarios, both of which say that disclosing or using trade secrets without the express or implied consent of the original “secret” owner is not allowed. Tesla maintains that by hiring so many of its former employees and using them in a similar capacity, Rivan has misappropriated their trade secrets.

Disclosing information you read in a confidential internal company memo to someone outside your company could potentially be considered divulging a company's trade secret. When transferring employment within the same industry, it is recommended that you avoid revealing any policies, procedures or technical details from your former employer.

The misappropriation of trade secrets is a real concern for business, especially those in emerging technology. If you feel that your company's trade secrets have been misappropriated in any way, consider reaching out to a business litigation attorney.

About the Author

William J. Cook

William J. Cook represents clients in matters involving business litigation and commercial and employment disputes, securities litigation, insurance, personal injury. Mr. Cook's peers have awarded him with the highest possible rating of AV-Preeminent* by Martindale-Hubbell, which speak...


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