A federal jury in Seattle has found Boeing guilty of misappropriating trade secrets and interfering with the business plans of Zunum Aero, an electric-aviation startup. Zunum Aero has been awarded $72 million in damages, but that amount may be tripled if the judge determines that the misappropriation was willful and malicious. Zunum Aero’s founders and shareholders are pleased with the jury’s decision, seeing it as a vindication after years of fighting. Boeing, on the other hand, has expressed disagreement with the verdict and plans to challenge it.
Zunum Aero, based in Bothell, Washington, was founded in 2013 and received support from Boeing and JetBlue’s technology ventures fund. The startup came out of stealth in 2017 and won an $800,000 grant from the Washington State Department of Commerce’s Clean Energy Fund. However, in 2020, Zunum filed a lawsuit against Boeing, alleging that the company had stolen trade secrets and interfered with its business relationships, leading to a cash shortage and operational cutbacks. The lawsuit went to trial in federal court this month, resulting in the recent jury decision in favor of Zunum Aero.
Zunum Aero had plans to build electric airplanes, with the goal of putting the first regional hybrid-electric and all-electric aircraft into service in the 2020s. The company selected Safran Helicopter Engines to provide the engine turbine for its 12-seat hybrid-electric aircraft. However, due to financial constraints, the startup had to scale back its operations. During the trial, Boeing argued that they had supported Zunum to the best of their abilities and had only used Zunum’s technical information for permissible purposes. Despite this argument, the jury sided with Zunum on multiple claims, resulting in the significant damages awarded.
The jury awarded $81.23 million relating to the misappropriation claims and $11.56 million relating to interference claims. However, they also found that Zunum had failed to mitigate $20.82 million in damages, reducing the net award to $71.97 million. Judge James Robart, before the trial, had issued a summary judgment requiring Zunum to repay $9 million in loans provided by Boeing, plus interest. This amount would be deducted from the damages awarded to Zunum. Post-trial motions challenging the award will now be considered by Robart, who will determine if a portion of the damages should be tripled based on the legal provisions regarding willful and malicious misappropriation of trade secrets.
Overall, the federal jury’s decision in favor of Zunum Aero marks a significant victory for the startup in its legal battle against Boeing. The awarded damages, which could potentially be tripled, showcase the seriousness of the misappropriation of trade secrets and interference with business relationships that occurred. Despite Boeing’s plans to challenge the verdict, the jury’s ruling provides validation for Zunum Aero’s claims and offers a sense of vindication for the founders and shareholders who have fought long and hard for justice. The outcome of this case may have lasting implications for how corporations handle trade secrets and protect the interests of smaller startups in the aviation industry.
