Nov 20, 2023

Nvidia Sued After Engineer Accidentally Shares Data From Old Job on Video Call

Peter Blumberg and Karin Matussek, Bloomberg News

A Nvidia Grace CPU Superchip, left, and Grace-Grace module arranged at the company's headquarters in Santa Clara, California, US, on Monday, June 5, 2023. Nvidia Corp., suddenly at the core of the world's most important technology, owns 80% of the market for a particular kind of chip called a data-center accelerator, and the current wait time for one of its AI processors is eight months. Photographer: Marlena Sloss/Bloomberg , Bloomberg

(Bloomberg) -- A Nvidia Corp. engineer, during a video conference call with his former employer, had one of those oops moments. He shared his screen, leaving a file up that contained data about robocar technology that he had stolen from his previous company, Valeo SE.

The engineer was convicted of infringing business secrets in Germany earlier this year and now Valeo is suing Nvidia in California.

Intellectual property theft is rarely revealed so stunningly, but egregious allegations of wrongdoing are a recurring theme in the global race to dominate the autonomous-driving market, which is projected to grow as high as $400 billion by 2035. Apple Inc., Tesla Inc. and Google Inc.’s Waymo all have made splashes accusing former employees of absconding with their self-driving secrets in defections to rival companies.

After Paris-based Valeo’s German unit confronted Nvidia about what happened on the March 2022 teleconference, the Santa Clara, California-based tech giant sought to defuse the situation.

“Nvidia has no interest in Valeo’s code or its alleged trade secrets and has taken prompt concrete steps to protect your client’s asserted rights,” a German law firm representing the Silicon Valley company wrote in a June 2022 letter to Valeo attorneys that was filed with the lawsuit. The letter said Nvidia had cooperated with the German criminal probe, and had determined through its own investigation that the engineer had done no harm.

That didn’t stop Valeo from filing a complaint Nov. 7 in federal court in San Jose, California. Officials at Nvidia declined to comment.

Oops Moment

The lawsuit stems from when the engineer, Mohammad Moniruzzaman, was on a virtual meeting with four other Nvidia employees to discuss ultrasonic hardware with staff from Valeo. The two companies were both under contract as suppliers for a parking and driving assistance project led by an unspecified major automotive parts maker.

Valeo claims Moniruzzaman realized the expertise he had gained working on its projects made him “exceedingly valuable to Nvidia.” In 2021, according to the lawsuit, shortly before he left Valeo, Moniruzzaman spirited tens of thousands of files and six gigabytes of the company’s source code to his personal email account. He allegedly tried to hide his misconduct by subsequently deleting his personal account’s authorized access to the Valeo network.

While he was on the conference call, he minimized a PowerPoint presentation he had displayed, revealing one of Valeo’s verbatim source code files on his computer screen for others to see, according to the complaint.

“Valeo participants on the videoconference call immediately recognized the source code and took a screenshot before Mr. Moniruzzaman was alerted of his error,” according to the complaint. “By then it was too late to cover his tracks.”

When German police raided Moniruzzaman’s home as part of the criminal investigation, the complaint says, they discovered Valeo documents and hardware pinned on the walls of his home office — “showing that Valeo information was a constant reference tool for him while working at Nvidia.”

Moniruzzaman was convicted of infringement of business secrets in a Stuttgart court and was ordered to pay €14,400 ($15,750) in September, according to a court spokesman. Attempts to reach Moniruzzaman were unsuccessful.

‘Relative Newcomer’

Nvidia, recently dubbed the first trillion-dollar semiconductor maker, started manufacturing hardware for autonomous driving in 2015, which makes it a “recent entrant” in the self-driving space, according to Valeo.

Valeo, founded a century ago, is a modest player in the global automotive business, with about €20 billion in annual revenue. Still, Valeo says it has has spent billions of dollars developing advanced driving-assistance systems.

For Nvidia, the engineer’s “brazen misconduct” provided an “illegitimate advantage,” according to the complaint.

“Nvidia’s attempts to take a shortcut to the marketplace by leveraging Valeo’s stolen software make costly investments in technology futile and harms innovation,” Valeo said.

“In general, Valeo makes significant investments in innovation every year, and it is in this regard normal to protect those investments,” the company said in a statement.

Nvidia’s Lawyers

Nvidia’s lawyers said in the June 2022 letter that the company knew nothing about the screen-sharing incident until the previous month, when Moniruzzaman reported that he’d been served with a summons for criminal copyright infringement and his laptop had been seized by police.

Moniruzzaman told Nvidia that the source code at issue had been stored on his laptop, not shared with others at the company, and that he only used the data to interface with Valeo technology, according the letter. Nvidia lawyers went on in the letter to detail the company’s efforts to ensure that it wasn’t accessing any of Valeo’s intellectual property.

The case is Valeo Schalter und Sensoren GmbH v. NVIDIA Corp., 23-cv-05721, US District Court, Northern District of California (San Jose).