Cash crunch hangs over Waymo-Uber engineer’s criminal defence

Anthony Levandowski, who has hit the kind of paydays that give Silicon Valley its reputation for jackpot wealth and excess, is figuring out how to pay the lawyers he’s leaning on to keep him out of prison.Charged with stealing trade secrets from Google before he defected to Uber Technologies Inc, the engineer has denied wrongdoing and is due to tell a federal judge who his lawyers will be. That’s taken longer and proved more complicated than might be expected for a pioneer of autonomous driving who sold startups to Google and later collected a $120mn bonus from the Alphabet Inc unit before he quit.According to his lawyers, much of that money is now tied up in real estate.“I know Mr Levandowski is working as hard as possible to make funds liquid,” his lawyer, Miles Ehrlich, told US District Judge William Alsup last week, explaining why the engineer hasn’t paid an up-front retainer to line up the lawyer’s firm for the duration of the case. A hearing on the matter that was scheduled for October 2 was pushed back to October 16 at Levandowski’s request.Levandowski’s criminal indictment mirrors a high-profile lawsuit brought by Alphabet’s driverless-technology unit Waymo against Uber that settled last year in the middle of trial. While Levandowski wasn’t a defendant in that case, prosecutors allege that he stole thousands of proprietary files, including the designs for lidar technology that helps autonomous vehicles see their surroundings, before he abruptly quit Waymo in January 2016.The engineer remains free on $2mn bail while he awaits his trial. He faces as long as a decade in prison and a fine of as much as $250,000 if he’s convicted of any of the theft charges in his 33-count indictment. The government is also seeking forfeiture of any proceeds “obtained directly or indirectly” from the alleged offences.Despite Ehrlich serving as Levandowski’s lawyer during Waymo’s civil case, experts said he and partner Ismail Ramsey have good reason to be concerned about the engineer’s liquidity. The two are top-shelf lawyers who run a small, eight-person firm in Berkeley, California. Levandowski’s defence in a full-blown trial could cost him as much as $5mn, and double that if he went to a large corporate firm, experts said.Ramsey cited Levandowski’s “lack of liquidity” about a month ago while addressing the judge who handled the engineer’s bail. While trying to fend off a push by prosecutors to increase the bail to $10mn, the lawyer argued that Levandowski’s wealth isn’t all that it seems.“The $120mn is not $120mn,” Ramsey said in court, as he explained how the bonus paid by Google has boiled down to a net worth of $72mn after taxes and a divorce. “It’s $120mn pretax, and before the child support settlement,” he said.“Yeah, they say a hundred million dollars doesn’t go as far as it used to,” Magistrate Judge Nathanael M. Cousins quipped, a response that drew a smile of appreciation from Levandowski.Ramsey said that after posting $300,000 in cash for his bail, Levandowski has $1.3mn in cash and securities that could be easily sold, but that even a “big chunk” of that sum is in various legal retainers. He didn’t elaborate. The remainder of his investments are largely in real-estate and “there is zero chance of being able to liquidate that in any sort of short period,” Ramsey said.Brandy Bergman, a spokeswoman for Levandowski, declined to comment. Ehrlich and Ramsey also declined to comment.Prosecutors, for a different reason, also say that the $120mn isn’t what it seems. Uber has disclosed that an arbitration panel this year issued an interim ruling against Levandowski that would require him to pay Google $127mn. The dispute essentially amounts to Google trying to reclaim the bonus it paid him on grounds that he broke a promise not to poach employees.Prosecutor Katherine L. Wawrzyniak voiced concern at an August hearing that with his vast wealth and dual citizenship in France, Levandowski might at some point try to charter a private plane and flee.Wawrzyniak told Cousins that the arbitration award might give Levandowski “incentive to disguise his assets.” She said that while the government doesn’t have “great visibility” into the engineer’s finances, it was clear that he worked for several years with “a sophisticated lawyer and had the ability to create a lot of different corporate entities and structures.” While the arbitration isn’t fully resolved, Levandowski has told prosecutors he may be on the hook for the sum. Uber indemnified Levandowski as part of its acquisition of one of his startups, and has disclosed that it could be responsible for “some or all” of the payment to Google.