Jawbone sues Fitbit for stealing its talent and trade secrets (updated)

Fitness tracker company Jawbone is suing its rival Fitbit for allegedly stealing its employees and trade secrets.

San Francisco-based Jawbone filed suit against San Francisco-based Fitbit in a state court Wednesday. (See the full text of the lawsuit here.) In the fitness tracker market, Jawbone ranks second to Fitbit, the market leader.

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Jawbone believes that some of its employees who have left to work for Fitbit have taken sensitive Jawbone information with them, or accessed it online with company passwords they shouldn’t have had.

One Jawbone ex-employee, Ana Rosario, took a job with Fitbit on April 16 but did not inform Jawbone of the fact until April 22. In the meantime, the lawsuit says, Rosario held a meeting with a product manager to talk about future product plans, and downloaded a “playbook” with more information on product plans.

Rosario initially denied taking confidential information, but later admitted to taking a copy of a Jawbone presentation called “Market Trends & Opportunities.”

The complaint says that during 2015, Fitbit recruiters contacted a third of Jawbone’s employees. One independent recruiter is quoted in the lawsuit as saying, “Fitbit’s objective is to decimate Jawbone.”

“This case arises out of the clandestine efforts of Fitbit to steal talent, trade secrets, and intellectual property from its chief competitor,” Jawbone’s lawyers wrote in the complaint.

Fitbit released a statement Wednesday evening denying Jawbone’s charges in the suit.

“As the pioneer and leader in the connected health and fitness market, Fitbit has no need to take information from Jawbone or any other company,” the statement reads.

It continues: “Since Fitbit’s start in 2007, our employees have developed and delivered innovative product offerings to empower our customers to lead healthier, more active lives. We are unaware of any confidential or proprietary information of Jawbone in our possession and we intend to vigorously defend against these allegations.”

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The lawsuit comes a crucial time in Fitbit’s history. The wearables company very recently filed for an IPO, in which it hopes to raise $100 million to expand its product line and marketing efforts.

Updated 5/27 10:15 p.m. PST with Fitbit statement.

Source: New York Times