Rivos, a stealth startup, was accused of stealing Apple chip secrets by poaching employees who took with them “gigabytes of confidential system-on-chip specifications and design files.” The startup filed a counterclaim to the iPhone manufacturer.
The counterclaim claims that Apple’s restrictions on employees seeking employment elsewhere are overly broad and designed to make employees afraid to leave the company…
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Apple chip secrecy lawsuit
Apple’s lawsuit dates back to May last year and accuses former Apple employees of using USB drives, AirDrop, cloud accounts and even Time Machine backups to steal sensitive information.
Apple is suing a stealth startup called Rivos for poaching engineers into gaining access to sensitive company information. According to the complaint, Apple believes the former employees stole confidential information at Rivos’ request as part of the hiring process. […]
Some used multiple USB drives to offload content to personal devices, accessed Apple’s most proprietary specifications stored in collaboration apps, and used AirDrop to transfer files to personal devices. Others saved lengthy presentations about existing and unreleased Apple SoCs marked “Apple Proprietary and Confidential” to their personal cloud drives. One even took a full backup of his entire Apple Time Machine device to a personal external drive.
The court dismissed the lawsuit but allowed Apple to file a revised lawsuit.
Rivos counterclaim against Apple
Bloomberg reports that Rivos is now filing a countersuit.
The countersuit was filed Friday by Rivos and six former Apple employees. [argues that] Apple’s “overbroad” non-disclosure and non-solicitation agreements are unenforceable.
“Fearing any threat to legitimate competition in the marketplace, and hoping to intimidate and send a message to any employees who would dare leave Apple to work elsewhere, Apple has resorted to attempting to thwart new startups through anti-competitive measures, including illegally restricting employee mobility,” Rivos said in his counterclaim.
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At the heart of the dispute is what Apple could reasonably order former employees to keep secret. Specific plans for future products, as well as Apple’s trade secrets, are not in doubt: both parties agree that the iPhone maker has the right to keep them confidential.
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However, Rivos argues that Apple goes beyond this and wants to protect everything employees learned during their time in Cupertino, regardless of whether that information is Apple’s intellectual property.
Additionally, Apple’s non-compete contract, which limits former employees’ ability to obtain positions with direct competitors, is said to be “designed and used by Apple to restrict employee mobility and competition.”
Echoes of the Gerard Williams III/Nuvia case
The case is similar to that of former Apple lead chip architect Gerard Williams III. Back in 2019, Apple sued him, accusing him of violating his employment contract for sharing company secrets with chip startup Nuvia. Williams countersued, arguing that Apple’s non-compete clause was unenforceable.
Nuvia was later acquired by Qualcomm, a company with which Apple had a tumultuous relationship.
Apple subsequently quietly dropped the lawsuit without explanation. The smartest thing to do would be to spend money on some kind of confidential agreement.