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Tesla Settles Lawsuit With Ex-Employee Over Autopilot Source Code

By Eric Volkman - Apr 18, 2021 at 6:35PM

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The company is being financially compensated for the alleged transgression.

Tesla Motors (TSLA -2.44%) is moving past a legal dispute it got into with one of its former engineers. The company settled a lawsuit it brought in 2019 against Cao Guangzhi, accusing him of copying the source code of its Autopilot assisted driving software platform. Tesla had alleged Cao had done so before joining XMotors, the U.S. business of China-based autonomous-driving company Xpeng (XPEV -1.60%).

Under the terms of the settlement, Cao will financially compensate Tesla for his actions. The precise amount has not been disclosed.

Autopilot is a high-profile feature in Tesla automobiles. Although the name implies an autonomous driving system, Autopilot is actually a set of assisted-driving solutions including next-generation cruise control and parking assist. The company has intimated that, in time, Autopilot will include self-driving functionalities.

A Tesla Model S on the road.

Image source: Tesla Motors.

Tesla has not commented on its settlement with Cao. The former employee's legal representative, in a statement sent to Reuters, claimed that Cao did not provide any Tesla data to Xpeng or any other entity. In addition, said the representative, Cao didn't personally access any of Tesla's information.

The news agency added that XMotors "said it respected intellectual property rights and relied on its in-house developed proprietary R&D and intellectual property." XMotors was not a party in the lawsuit brought by Tesla. Cao is no longer employed at the Chinese company.

Although this can't be considered a major legal issue -- and therefore big victory -- for Tesla, it is an encouraging sign that the company is ready and able to vigorously defend its business. Autopilot is an attractive feature that helps draw customers, and as such it's worth protecting.

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Tesla. The Motley Fool has a disclosure policy.

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