Magic Leap Violates Laws Prohibiting Restraints on Employee Mobility Says Defendants

magic leapAs reported back in June, augmented reality startup, Magic Leap, filed a trade secret misappropriation lawsuit in the Northern District of California against two former high-level employees, Dr. Gary Bradski and Dr. Adrian Kaehler.  Magic Leap’s complaint alleges, among other things, that Bradski and Kaehler worked together for at least a year, while employed by Magic Leap, to create and develop plans for a new company using “Magic Leap’s intellectual property and Proprietary Technologies.”

Earlier this month, Bradski and Kaehler struck back against Magic Leap with a flurry of responsive filings.

First, in their Motion to Dismiss, the defendants allege that Magic Leap’s lawsuit “violates Dr. Bradski and Dr. Kaehler’s freedom to pursue independent consulting; in addition, California law prohibits restraints on employee mobility and ‘protects Californians and ensures that every citizen shall retain the right to pursue any lawful employment an enterprise of their choice.'”  The motion alleges that both Bradski and Kaehler were considered experts in computer vision and machine learning, and discussed starting a robotics company long before joining Magic Leap.  Moreover, according to the motion, both Bradski’s and Kaehler’s employment agreements with Magic Leap each provided that “he will be free to pursue independent consulting work.”  After their hiring, Magic Leap allegedly failed to allocate budget to Kaehler’s project, and “for Dr. Bradski’s part, he had been increasingly ostracized.”  In March and April 2016, Kaehler disclosed his plans to leave Magic Leap to work on a “noncompetitive project,” and both Kaehler and Bradski subsequently returned their computers and research to Magic Leap.

In terms of legal argument, the motion asserts that “Dr. Bradski’s and Dr. Kaehler’s skills and expertise, pre-dating employment, and their prior work combining machine vision, deep nets, and robotics cannot be any Magic Leap trade secret.”  In an interesting legal argument, Defendants also assert that the Defense of Trade Secrets Act claims should be barred because “all acts complained of occurred, were disclosed, and ceased prior to the [DTSA] going into effect on May 22, 2016.”

In addition to its Motion to Dismiss, Defendants each filed a Motion for Sanctions of Dismissal (“Rule 11 Motions”) against Magic Leap.  The Rule 11 Motions forcefully assert that Magic Leap filed a “baseless suit without reasonable inquiry; and for the improper purpose of harassing the defendants, staging a fishing expedition and smear campaign designed to paralyze and prevent defendants from any gainful employment.”  In addition to dismissal, defendants seek an award of attorneys’ fees which they claim are “justified and necessary for effective deterrence of future violations by Magic Leap and similarly-minded employers.”

Magic Leap has until September 12 to respond to Kaehler’s and Bradski’s Motions to Dismiss and Rule 11 Motions.  A hearing on the motions is scheduled for Wednesday, October 12, 2016.

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In the News: Magic Leap

magic leap

The secretive startup company, Magic Leap, made headlines recently with two stories of note.  First, as reported last week by UploadVR, Magic Leap is suing two former employees in federal court for trade secret misappropriation.  Magic Leap’s complaint alleges that Gary Bradski (Senior Vice President of Advanced Perception and Intelligence) and Adrian Kaehler (Vice President of Special Projects)  worked together for at least a year, while employed by Magic Leap, to create and develop plans for a new company using “Magic Leap’s intellectual property and Proprietary Technologies” in violation of their various employment agreements.  According to the complaint, while at Magic Leap, Bradski was involved in projects that involved “deep learning techniques for robots,” and that Kaehler was “responsible for the definition and development of technologies of certain projects, as well as the technical vision, staffing, budget, and ultimate implementation of such projects.”  The complaint further alleges that Bradski “disclosed Magic Leap’s confidential information and trade secrets to third parties and specifically misrepresented to third parties that such confidential and trade secret information did not belong to Magic Leap.”

Magic Leap’s complaint is noteworthy in that it asserts trade secret misappropriation claims under the new federal Defense of Trade Secrets Act (“DTSA“), which was signed into law by President Obama only a few weeks prior to the filing of this suit.

Although the details of the allegations are somewhat vague at this point, more information will likely come to light soon.  Because the complaint also asserts trade secret misappropriation claims under California state law, Magic Leap must identify the trade secrets which were allegedly misappropriated with reasonable particularity pursuant to Section 2019.210 of the California Code of Civil Procedure.

magic leap-2In less contentious news, it was also reported in the past few days that the USPTO had issued a design patent, US D758,367, to Magic Leap for a Virtual Reality Headset.  The design patent contains eight drawings (one of which is shown to the left) and was filed on May 14, 2015.

However, Magic Leap’s VP of public relations, Andy Fouché, provided the following somewhat definitive statement to Tech Insider regarding the patent’s images:

“This is part of our R&D and experience validation, and is not at all representative of what our product will look like. Items that any company patents can be helpful to the entire process, regardless if they end up pursuing that path or not.”

So it appears that Magic Leap’s product will continue to remain a secret for now.