Tesla Wins Order To Arbitrate Trade-Secret Case Against Former Engineer

A San Francisco federal judge has sent a dispute between Tesla Inc and its former engineer Alexander Yatskov to private arbitration, rejecting Yatskov's plea to keep the case in court so he could publicly contest Tesla's "humiliating" claims.

U.S. District Judge James Donato ordered the case to arbitration after a Thursday hearing. Tesla had argued that Yatskov was bound by an arbitration clause from his employment agreement with the company.

Yatskov's attorney John Kirke of Donahue Fitzgerald said Friday that the firm will "continue to do whatever is necessary to clear Dr. Yatskov's name, whether in open court or a private arbitration."

Tesla's attorneys did not immediately respond to a request for comment Friday.

Tesla sued Yatskov in May for allegedly taking confidential information about the company's Dojo AI-training supercomputer and storing it on his personal computer. The lawsuit also alleged Yatskov provided a "dummy" computer for Tesla to investigate to "cover his tracks."

Yatskov said Tesla had filed the lawsuit during his last day of work there, and that he turned over all company materials after he left. He has asked the court to dismiss Tesla's trade-secret claims.

Yatskov also opposed Tesla's request to arbitrate the case. He said the company's "humiliating" claims had "irreparably damaged" his reputation and asked to defend against them in open court instead.

Yatskov's motion said Tesla had already lost on its bid for a temporary restraining order, and Tesla wanted to "shield its future failures and Dr. Yatskov's victories from the public eyes."

He said Tesla had waived its right to arbitration by pursuing the case in court.

"Now that Tesla has dragged Dr. Yatskov's name through the mud, Tesla wants to hide this dispute in private arbitration and deprive Dr. Yatskov of the opportunity to clear his name publicly," he argued. "Tesla cannot have it both ways."

But Donato agreed with Tesla that the case should be arbitrated. Tesla had characterized its lawsuit as a request for "emergency injunctive relief to preserve the status quo," a type of filing it said the arbitration clause specifically authorised.

Source: Reuters