Waymo LLC v. Uber Technologies Inc., et al  2017 WL 4018404

United States Court of Appeals, Federal Circuit 

Waymo brought an action against Uber, alleging trade secret misappropriation and unfair competition. Uber did not have an arbitration agreement with Waymo, but moved to compel arbitration based on the arbitration agreement between Waymo and former employee and Intervenor, Anthony Levandowski. The court denied the motion to compel and Uber appealed.

The United States Court of Appeals for the Federal Circuit affirmed. Uber argued that equitable estoppel applied to compel arbitration because Waymo contended that the misappropriated information used by Uber was acquired by Levandowski when he was employed by Waymo. The Court applied Kramer, which provides that equitable estoppel applied in two circumstances: 1) when a signatory relies on the terms of the written agreement in asserting its claims against the non-signatory or the claims are intimately founded in and intertwined with the underlying contract; and 2) when the signatory alleges substantially interdependent and concerted misconduct by the non-signatory and another signatory and the allegations of interdependent misconduct are founded in or intimately connected with the obligations of the underlying agreement. On the first prong, Waymo did not rely on its employment agreement with Levandowski as the foundation of its claim. The Court rejected Uber’s argument that the “or” in the language created a separate standard such that Uber need not show that Waymo relied on the employment agreements, referencing California law that defined reliance on an agreement as raising claims that are intimately founded in or intertwined with that agreement. The Court similarly rejected Uber’s argument that Waymo had to rely on its agreements with Levandowski to make out its trade secret claims since reference to the agreements did not constitute reliance. Uber’s final argument that the lower court erred in relying on Waymo’s disclaimer of reliance “so long as Uber did not open the door” did not change the Court’s analysis. On the second prong, Waymo did not argue that Uber conspired with Levandowski to breach the agreement.