Investor Sues Uber Over the Acquisition That Triggered Waymo’s Lawsuit

There seems to be no end to the company's legal troubles.

Uber just can’t catch a break. As Waymo’s lawsuit against Uber drags on, an Uber investor and former employee is filing a suit of his own against the ride-sharing company, targeting the purchase of a startup that triggered the entire sordid affair.

Lenza McElrath III, who previously worked for Uber as an engineer, argues that Uber didn’t properly vet autonomous-driving startup Otto ahead of its purchase last year. Otto was founded by Anthony Levandowski, the former Waymo engineer accused of stealing trade secrets from his ex-employer and funneling them to Uber.

The suit argues that Uber’s acquisition of Otto amounted to “an improper and potentially criminal raiding of Google’s assets,” and claims Uber officials ignored “red flags” indicating Otto was engaged in shady business. McElrath blames this in part on the recklessness of former Uber CEO Travis Kalanick, who is named as a defendant in the suit. Kalanick resigned as CEO in June after a string of scandals but remains on Uber’s board.

When asked about the accusations, an Uber spokesperson told Bloomberg that executives were still investigating the suit and that the company would not comment at this time. The spokesperson also noted that McElrath has sued Uber in the past over allegedly misleading employees about compensation issues.

McElrath’s lawsuit makes similar accusations to Waymo’s. Both allege that Levandowski stole confidential information from Waymo and that at least some Uber officials knew about before buying Otto. Levandowski was brought into Uber’s self-driving car program after the sale, but was fired for not cooperating with efforts to fight the Waymo suit. In addition, Waymo accuses Uber of actually using stolen information to benefit its own autonomous-car efforts.

The Uber vs. Waymo case was supposed to go to trial this month, but it was delayed after new allegations of corporate spying by Uber emerged. Federal prosecutors released a letter written by Richard Jacobs, a former Uber security officials, describing efforts to spy on competitors. Uber has said the letter was a negotiating ploy by Jacobs during his termination, and that it does not change the facts of the case.