Federal Jury Determines Boeing Committed Theft of Technology from Electric Plane Startup

A federal jury determined that Boeing unlawfully obtained trade secrets from Zunum, an unsuccessful electric aircraft startup. The aviation company was a significant investor in Zunum through its venture capital arm, Horizon X. The electric startup alleges that Boeing conducted a targeted effort to steal confidential information for the development of its own hybrid-electric plane, as reported by Reuters. Boeing contends that it only created a prototype to assess the feasibility of Zunum’s proposed aircraft.

Zunum initially disclosed information about its innovative aircraft concept in 2017. The startup pledged to introduce a hybrid airplane with easily interchangeable batteries built into the wings. The aircraft was intended to accommodate nine passengers and cover distances of up to 700 miles. The objective was to revolutionize the regional jet sector with an exceptionally fuel-efficient, environmentally friendly airplane. Unfortunately, this aircraft never came to fruition. By 2019, Zunum had depleted its funds and went out of business. According to the Seattle Times, the demise of the startup was not surprising:

Boeing’s legal team, in response to the lawsuit, portrayed Zunum’s collapse as typical of many failed startups.

Boeing’s court filing stated, “An ambitious startup overreached, and investors withdrew. What seemed like a promising investment opportunity for a new hybrid electric or electric aircraft turned into a financial loss for Boeing.”

Instead of creating its own hybrid-electric model, Boeing maintained that it only fabricated a “conceptual mock-up — a tool used by Boeing to assess the viability of the type of aircraft Zunum aspired to create.”

Based on its assessment from the mock-up, Boeing concluded that “electric aircraft were unlikely to be economically feasible for commercial passenger flights in the near future.”

Boeing contended that other potential Zunum investors arrived at the same conclusion. The lawsuit was described as “Zunum’s latest effort to extract more money from Boeing.”

The jury granted Zunum $81 million in damages. U.S. District Judge James Robart has the option to triple that amount. Boeing is not done with this legal battle. In a statement, the company announced its intention to challenge the verdict through all available means. The resolution of this case could take years. Boeing is still confronting legal issues related to the two crashes of the 737 Max.