Posts Tagged: accused

Apple drops lawsuit against former exec who accused company of spying

After more than three years of litigation, Apple has quietly dropped its lawsuit against Gerard Williams III, the former chip executive the company accused of poaching employees. Williams spent nearly a decade working for Apple, leading development on some of its most important chips – including the A7, the first 64-bit processor for mobile devices.

In 2019, Williams left Apple to co-found Nuvia, a chip design firm later acquired by Qualcomm in 2021. When the tech giant first sued Williams, it accused him of “secretly” starting Nuvia and recruiting talent for his startup while he was still an Apple employee. Williams disputed Apple’s claims and accused the company of spying on his text messages.

As reported by Bloomberg, Apple filed a request to dismiss the suit against Williams earlier this week. The document does not state the company’s reason for dropping the case. However, it does say Apple did so “with prejudice,” meaning it cannot file the same claim against Williams again. It also suggests the two sides came to a settlement. Apple did not immediately respond to Engadget’s comment request.

In the weeks leading up to Wednesday’s dismissal request, court documents show Apple sought the recusal of Judge Sunil Kulkarni. Around March 17th, 2023, the company added two lawyers from the legal firm Morrison and Foerster to the team litigating its case against Williams. On March 28th, Judge Sunil Kulkarni filed a brief disclosing that he had worked at Morrison and Foerster for approximately 13 years and had kept in contact “over the years” with Bryan Wilson and Ken Kuwayti, the two “MoFo” attorneys Apple hired on as counsel earlier in the month.

“I have occasional social interactions with them (e.g., bimonthly lunches, seeing them at parties of mutual friends, and so on),” Judge Kulkarni wrote. “I believe I have recused myself from past cases involving Mr. Wilson and/or Mr. Kuwayti, but solely as a prophylactic measure.” After learning of the involvement of his former colleagues, Judge Kulkarni held an “informal” meeting with the two sides where he said he was “leaning toward recusal” if Apple retained the counsel of either Wilson or Kuwayti. In that same meeting, Kulkarni says he told Apple and Williams his recusal from the case would likely mean a delay in the case going to trial. Before the meeting, the case was scheduled to go to trial on October 2nd, 2023.

In a brief filed on April 6th, Williams and his legal team came out strongly against the idea of Judge Kulkarni removing himself from the case, arguing Apple’s position on the subject “should not matter” and that the move had the potential to be “prejudicial” against the former exec.

“Given that this case has been pending for over three years – with a fast-approaching discovery deadline and trial date – and given the Court’s familiarity with the parties, the case history, and the applicable law, the Court’s recusal decision has the potential to be prejudicial and disruptive,” the brief states. It then argues it was Apple that introduced a potential conflict of interest to the case.

“Even if a conflict existed that might warrant recusal, the procedure imposed by the Court – allowing the party that introduced the ‘conflict’ and would theoretically stand to benefit from it – to decide whether to waive it is inconsistent with basic rules of fairness and due process,” the brief concludes. “Such a procedure would set a dangerous precedent for judge shopping in the middle of a case: any part, at any time, could recruit former colleagues of a sitting judge and then force his or her recusal.”

Putting together what happened after that point is more difficult. However, after the 6th, the court in Santa Clara held multiple hearings where no one from either side appeared. Apple then filed to dismiss the case on April 26th. Qualcomm, Williams’ current employer, did not immediately respond to Engadget’s request for comment. 

This article originally appeared on Engadget at https://www.engadget.com/apple-drops-lawsuit-against-former-exec-who-accused-company-of-spying-211547595.html?src=rss
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Here’s everything Sam Bankman-Fried is accused of by the US government

On Monday evening, Bahamian authorities arrested FTX founder and former CEO Sam Bankman-Fried at the request of the US government. The following morning, the Securities and Exchange Commission (SEC), Department of Justice (DOJ) and Commodity Futures Trading Commission (CFTC) filed formal civil and criminal charges against Bankman-Fried in "parallel actions." It was a lot to take in all at once, so below Engadget has broken up current charges against SBF by agency, with some additional context provided.

Those indictments likely represent only the start of Bankman-Fried's troubles. In addition to the charges it announced on Tuesday, the SEC said it was investigating Bankman-Fried for other securities violations. The agency also announced that it’s actively examining the actions of other FTX executives and employees. As more charges are unsealed, Engadget will continue to update this article.

Securities and Exchange Commission

The Securities and Exchange Commission accused SBF of defrauding FTX investors and customers of more than $ 1.9 billion. Starting as early as May 2019 until as recently as this past November, "Bankman-Fried was orchestrating a massive, years-long fraud, diverting billions of dollars of the trading platform's customers funds for his own personal benefit and to help grow his crypto empire," the SEC said.

All the while, Bankman-Fried portrayed himself as a responsible business leader building a safe trading platform with "sophisticated, automated measures to protect customer assets." In reality, the SEC says, "Bankman-Fried orchestrated a fraud to conceal the diversion of customer funds to his privately-held crypto hedge fund, Alameda Research."

Bankman-Fried told investors and customers FTX's sister company was just another platform on the exchange with no special privileges to speak of. "These statements were false and misleading," according to the SEC. Alameda had access to a "virtually unlimited 'line of credit" unknowingly funded by FTX customers. In May 2022, when Alameda's lenders demanded the firm repay loans worth billions of dollars, Bankman-Fried allegedly directed FTX to divert even more money to the hedge fund.

The SEC seeks to bar Bankman-Friend from trading securities in the future. The agency also wants to seize his ill-gotten gains and bar him from acting as an officer or director at another company.

Current FTX CEO John Ray III testified before the House Financial Services Committee on Tuesday — SBF had said he would attend the hearing before his arrest. Ray spoke to some of the allegations detailed by the SEC. "This is really old-fashioned embezzlement," he told the panel. "We've lost $ 8 billion. I don't trust a single piece of paper in this organization."

Department of Justice

In addition to civil charges, Bankman-Fried faces a criminal indictment from the Justice Department. On Tuesday, prosecutors from the Southern District of New York filed eight charges against the former executive, including multiple counts of wire fraud. The Justice Department alleges SBF conspired with other individuals to defraud investors by sharing misleading information about FTX and Alameda's financial condition. Prosecutors further accused him of attempting to commit commodities and securities fraud. On top of that, Bankman-Fried allegedly broke federal election laws by donating more than is legally allowed and in the names of other people.

SBF spoke about his political donations in a recent interview with journalist Tiffany Fong. "I donated to both parties. I donated about the same amount to both parties," he said. "All my Republican donations were dark. The reason was not for regulatory reasons, it's because reporters freak the fuck out if you donate to Republicans."

It's worth emphasizing how serious the criminal charges against Bankman-Fried are. For context, a federal judge recently sentenced Theranos founder and former CEO Elizabeth Holmes to 11 years in prison for defrauding the company's investors and patients. Meanwhile, Ramesh "Sunny" Balwani, the startup's former chief operating officer, was sentenced to nearly 13 years in prison for his role in the scheme. Sam Bankman-Fried stands accused of defrauding investors of almost $ 2 billion, or about twice what investors lost to Theranos.

Commodity Futures Trading Commission

Rounding out the current charges against Bankman-Fried, the Commodity Futures Trading Commission accused the former executive of using Alameda Research to "surreptitiously" siphon customer funds. "At Bankman-Fried's direction, FTX executives created features in the underlying code for FTX that allowed Alameda to maintain an essentially unlimited line of credit on FTX," the regulator alleges. It adds that Alameda had other "unfair" advantages, including an exemption from the platform's auto-liquidation risk management process.

As early as May 2019, SBF and "at least one" other Alameda executive directed the firm to use FTX customer funds to trade on competing platforms and buy "high-risk" digital assets. Additionally, the CFTC alleges that Bankman-Fried and his cohorts "took hundreds of millions of dollars in poorly-documented 'loans' from Alameda," which they then used to purchase real estate and make political donations.

For his actions, the CFTC is seeking to ban Bankman-Fried from trading derivatives and impose civil penalties against him. It also wants to bar him from acting as a director or officer in the future.

Engadget is a web magazine with obsessive daily coverage of everything new in gadgets and consumer electronics

Apple supplier accused of chemical safety and overtime violations

Apple is still struggling to improve working conditions at its suppliers. Both China Labor Watch and Bloomberg report that Catcher, a key supplier for iPhone and MacBook casings, makes workers endure harsh safety conditions and unfair work terms in…
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