Tesla And Rivian Head To Court In Trade Secret Lawsuit

Tesla, Inc. (NASDAQ:TSLA) and Rivian Automotive, Inc. (NASDAQ:RIVN) could face off in a California court over the former’s lawsuit, alleging some of the latter’s employees violated non-disclosure agreements.

A California state court on Wednesday tentatively denied requests by the employees for a summary adjudication ruling, Bloomberg reported.

A summary adjudication would have allowed the resolution of specific issues in a case without going through a full trial. This follows a request by a party to rule on a particular issue(s) that are vital in the dispute.

The case was filed by Tesla in 2020 and the Elon Musk-led company alleged that Rivian hired a batch of former Tesla employees, who in turn passed on to the startup documents comprising “highly sensitive trade secret, confidential, and proprietary engineering information.”

Tesla expanded the lawsuit in 2021, claiming that Rivian stole core technology related to its next-gen batteries. Rivian, meanwhile, had denied any wrongdoing.

If the ruling is finalized, Tesla’s lawsuit would proceed to a trial, pitting Tesla against Rivian, which is gradually transforming into a potent threat in the electric vehicle arena.

The development comes about two weeks after the two companies announced a partnership, which provides for Rivian to adopt the North American Charging Standard pioneered by Tesla. 

Rivian has pushed ahead from the crowded EV startup field and has been successful with production ramp-up and manufacturing efficiency.

In premarket trading on Thursday, Tesla was trading flat at $254.05 and Rivian fell 0.85% to $25.69, according to Zenger News Pro data.

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