SAN FRANCISCO—On the second day of the Waymo v. Uber trade secrets trial, US District Judge William Alsup ruled in favor of Waymo, allowing an internal due diligence report to stand.

Late Monday, several hours after the first day's trial, in court filings, Uber lawyers asked the judge to exclude a slew of materials and deposition testimony that was made public for the first time on Monday evening, arguing that they constituted inadmissible "hearsay."

Among others, these items include drafts and notes that eventually formed the due diligence report that Uber commissioned after a star self-driving engineer, Anthony Levandowski, abruptly left Google in January 2016. Several months later, Levandowski's company, Ottomotto, was acquired by Uber for $680 million.

In the run up to the deal, Uber hired well-known forensics firm Stroz Friedberg to investigate whether Uber’s hands would be clean before it eventually acquired Lewandowski's new company, Ottomoto. That document, known as the Stroz Report, was finalized in August 2016 and was later made available publicly as part of the court record in October 2017.

Further Reading Here’s the “due diligence” report Waymo hopes will win its case against Uber trade secrets” but also said he had not taken any intellectual property. Levandowski, who was fired from Uber in May 2017, has refused to testify.



According to documents filed in the case and referenced during opening arguments, Uber began its efforts to buy a non-existent company that Levandowski was set to form even before he had left Google. Uber "reached agreement [in] December (started [negotiating] term sheet which was signed in [February])," the notes continue, referring to Levandowski. "There was a plan to [acquire] Otto before he left Google." However, later on in those same notes, Levandowski added that he was "not relying on Google technology to do the work for Uber."

That timeline has Uber agreeing to buy Levandowski's startup in December 2015 before he left Google the following month. All of this material will stay in, and the jury can see it, the judge ruled.

"Uber set up this elaborate system; even put in the best light for Uber, Uber wanted to get at the truth of what was going on," Judge Alsup said. "So to my mind, anything that those investigators at Stroz wrote down as having been said by Levandowski or anybody else is accurate. That's step one. Uber cannot be heard to say that it's hearsay. It is so attributable to Uber that it's an injustice that Uber gets to run away from that due diligence."

He explained that if a person is reporting on what another person said, then yes, that is hearsay—but the notes, drafts, and the report itself will stay. "You're stuck with that report," he said. "Too bad for Uber, that you set up this elaborate system. You're stuck with the fact that, anything that Stroz wrote down, it might as well be that Uber wrote it down."

The lawsuit, Waymo v. Uber, began back in February 2017, when Waymo sued Uber and accused one of its own star engineers of stealing 14,000 files shortly before he left Waymo.

The former employee, Anthony Levandowski, went on to found a company that was quickly acquired by Uber. Levandowski refused to comply with his employer's demands during the course of this case and was fired. Uber has denied that it benefited in any way from Levandowski's actions.

The outcome of the case will likely determine which company will end up ahead in the cutthroat and rapidly growing autonomous vehicle sector.