(Bloomberg) -- Instacart Inc. cofounder Apoorva Mehta was accused in a lawsuit of using stolen trade secrets to create a healthcare startup that was a copy of an existing company.
Hello Logistics Inc., which operates under the name NextMed, sued Mehta, his business partner Tejasvi Singh, and their company Cloud Health Systems over allegations of misappropriation of trade secrets, copyright infringement and other claims. Both companies run websites promoting weight loss.
“Wanting in on NextMed’s success, and in search of venture capital funding for a new project,” Mehta teamed up with Singh, “to do what Mehta later said he considered ‘unethical but not illegal’— create a copycat company,” NextMed said in the complaint filed Monday in Manhattan federal court.
Singh, a cofounder of NextMed, collected some of the company’s closest held trade secrets under the guise of gathering the information as part of due dilligence for investors, according to the complaint.
Mehta and Singh then used the information to create a company that does business as Sunrise, with a copycat website, according to the complaint. They also lined up vendors and implemented NextMed’s highly confidential customer acquisition and other strategies, “in mere weeks,” NextMed claimed in the complaint.
Instacart didn’t immediately respond to a request for comment, made after regular business hours. Sunrise also didn’t immediately respond to an emailed request for comment.
Mehta’s new company was launched a few weeks ago, has already raised $30 million from two venture capital firms, NextMed said.
NextMed is seeking an order to shut down the Sunrise website and unspecified monetary damages.
The case is Helio Logistics Inc. v. Mehta, 7:22-cv-10047-NSR, US District Court, Southern District of New York (Manhattan).
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