Tesla and Rivian Settle Four-Year Trade Secret Dispute Before Trial
As reported by Yahoo Finance, the two competitors in the electric vehicle market have agreed to settle a four-year trade secret dispute. The settlement—which has confidential terms—will allow the companies to avoid litigation over the trade secret dispute. A trial was set to begin in March of 2025. Here, our Florida trade secret attorney provides an overview of the dispute and the law.
Understanding the Trade Secret Dispute Between Tesla and Rivian
Tesla and Rivian are competitors in the electric vehicle (EV) market—particularly the luxury and high performance-focused segments of this market. While Tesla offers a broader range of electric vehicles, Rivian is focused more on the electric truck and electric SUV markets. The two companies have been locked in a more than four-year trade secret dispute.
In July 2020, Tesla filed a lawsuit against Rivian, alleging that Rivian had engaged in a systematic effort to recruit Tesla employees and misappropriate its trade secrets. Tesla claimed that Rivian encouraged these employees to disclose confidential information, including proprietary data related to electric vehicle (EV) battery technology. Notably, the lawsuit highlights specific allegations where former Tesla employees purportedly took and (disclosed) sensitive documents and information without authorization after joining Rivian. For its part, Rivian has publicly denied wrongdoing.
A Settlement has Been Reached (Avoids Trade Secret Litigation)
The trade secret dispute between the two electric vehicle manufacturers has been settled. In late 2024, Tesla and Rivian reached a conditional settlement in the trade secret misappropriation claim. Tesla informed a court in California of the agreement. The lawsuit—which was set for trial in March of 2025—was dismissed. The specific details of the settlement have not been disclosed.
The Elements for Trade Secret Protection
Trade secrets are protected under both state and federal law. With that being said, a company cannot simply declare information/documentation to be a “trade secret.” Certain criteria must be satisfied for trade secret protection to apply. Here are the most important legal elements:
- The Information Must Actually Be Secret: To start, the information must not be generally known or readily accessible. Common examples include formulas, processes, customer lists, or business strategies. If the information is widely available, it cannot be protected.
- The Information Must Have Economic Value: Next, the secrecy of the information should provide the owner with a business advantage. For example, a unique manufacturing technique that reduces costs or enhances product quality has clear economic value. Information that is not commercially valuable is not a trade secret.
- Reasonable Efforts Must Be Made to Protect the Information: Finally, businesses must take active steps to keep the information confidential. Some examples include measures like properly-drafted employee confidentiality agreements, restricted access, secure storage, and regular monitoring. Failure to protect information could invalidate trade secret protections.
Set Up a Confidential Consultation with a Top Florida Trade Secret Attorney Today
At Perkins Law – Brand Protection, our Florida intellectual property attorney has deep experience handling trade secret cases. If you have any specific questions or concerns about trade secret protections, we are more than ready to help. Call us now or contact us online for your completely confidential case review. With a law office in Boca Raton, we handle trade secret disputes throughout South Florida.
Source:
finance.yahoo.com/news/tesla-rivian-agree-settle-four-133700282.html
