Published in IoT

Fitbit has five staff members facing criminal charges

by on15 June 2018


Its woes get worse

Fitness watch maker Fitbit is having a few financial problems at the moment, but things appear to be getting worse after six of its staff are facing criminal charges for nicking technology.

 The indictment against one current and five former Fitbit employees accuses them of taking stolen trade secrets from their former employer, Jawbone, to their new jobs at Fitbit.

The named defendants include six former and current Fitbit employees: Katherine Mogal, 52, of San Francisco; Ana Rosario, 33, of Pacifica; Patrick Narron, 41, of Boulder Creek; Patricio Romano, 37, of Calabasas; Rong Zhang, 45, of El Cerrito; and Jing Qi Weiden, 39, of San Jose. Mogal faces six counts, while Weiden only faces one—the others range between two and five counts.

It was not clear which of these six is the current Fitbit employee. According to LinkedIn,  Rosario and Narron left the company years ago.

Authorities say each had worked for Jawbone for at least a year between May 2011 and April 2015 and allegedly violated their confidentiality agreement. While working for Jawbone, they were seemingly recruited to work for Fitbit, and, prosecutors claim, took trade secrets along.

The defendants are scheduled to make their first appearance in court on July 9, 2018, at 1:30 pm before US Magistrate Judge Virginia K. DeMarchi in San Jose.

Jawbone went out of business as of July 2017 and is undergoing liquidation proceedings. However, it was a staunch competitor and both had sued one another multiple times.

Fitbit needs this like a hole in the head. It has lost over $380 million from 2016 through 2017, wiping out its two earlier profitable years. Its number of devices sold has plummeted from 22.2 million in 2016 to 15.3 million in 2017.

In February 2017, Jawbone said in a California state court filing that Fitbit was facing a criminal probe into its behavior, although Fitbit denied it.

"After a full examination of the issues and Fitbit’s resounding victories at the [United States International Trade Commission], coupled with Jawbone’s complete failure in the marketplace and reported insolvency, Jawbone is now attempting to exert leverage against Fitbit in civil litigation pending in the California state court", Fitbit said in a February 2017 statement sent to Fortune. "Fitbit is cooperating with the US Attorney’s Office to demonstrate, once again, that these allegations are without merit."

 

 

Last modified on 15 June 2018
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