Creating a startup that competes along with your former employer could be dangerous. Apple, for instance, as soon as sued a former chip design govt who based his personal chip startup in a case that was dropped in 2023.
A latest case involving logistics unicorn Flexport and a brand new competitor shaped by two former staff sheds mild on these dangers.
Flexport is suing the pair alleging that they stole 1000’s of its paperwork together with its supply code to create their very own rival startup, Freightmate AI.
Each startups use know-how to automate complicated logistics and transport processes.
Flexport says it believes Freightmate’s COO Yingwei Zhao downloaded over 70,000 confidential Flexport paperwork after he agreed to kind Freightmate with now-CEO Bryan Lacaillade, Flexport mentioned in the lawsuit, which was filed final week in a California court docket.
Flexport claims that Zhao took steps to cover his tracks like utilizing Incognito Mode on his browser to copy-paste a listing of over 1,000 Flexport prospects. The go well with alleges that Zhao additionally downloaded Flexport’s supply code from Github onto his USB drive.
Freightmate admitted to being in possession of some recordsdata from Flexport however mentioned the recordsdata had been “inadvertently retained” and never accessed or utilized by Freightmate, based on the go well with.
Flexport declined to remark. Freightmate didn’t reply to a request for remark.
Flexport claims latest development touted by Freightmate would have been “just about unattainable” with out info it insists was stolen. It’s suing for unspecified damages and an injunction from the court docket, which may very well be used to cease Freightmate from utilizing the allegedly stolen knowledge.
Flexport relies in San Francisco and was valued at $8 billion in a 2022 funding round. It most just lately raised a $260 million spherical supplied by Shopify at an undisclosed valuation in 2023.
Freightmate relies close to Seattle and raised a $5 million seed spherical in January 2025 led by Washington state VC agency Fuse Capital. Its pre-seed spherical, whose quantity was undisclosed, was led by Winschoff Ventures.
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