June 18, 2024 – Tesla has filed a lawsuit against its former supplier, Matthews International, accusing the company of stealing its trade secrets and attempting to patent confidential information related to electric vehicle batteries. The legal action was initiated in the Northern District of California federal court on Friday.
Despite both companies being headquartered outside of California, the lawsuit alleges that Matthews, located in Pennsylvania, frequently sent employees to meet with Tesla staff in the state. Tesla operates a large factory in Fremont, near San Francisco.
According to the lawsuit, Matthews began supplying Tesla with equipment to improve its dry electrode manufacturing process in 2019, aiming to produce lighter batteries with solid-state storage capabilities. As part of the agreement, Matthews agreed to keep the confidential information secret.
“However, Matthews has betrayed this trust,” Tesla stated in the complaint. “Without Tesla’s permission, Matthews has used Tesla’s confidential business secrets for various illegal purposes, causing significant losses to Tesla.”
Tesla claims that Matthews incorporated the stolen trade secrets into patent applications and further alleges that the company is “blatantly” trying to portray itself as the owner and inventor of Tesla’s technology. Tesla discovered these patent applications after finding its confidential information in the publicly filed documents.
Moreover, Tesla asserts that Matthews’ misconduct extends beyond patent applications. The company is also suspected of selling Tesla equipment used in dry electrode manufacturing to competitors. Tesla emphasizes that it never authorized such sales, resulting in its competitors gaining access to its technology.
In the lawsuit, Tesla demands a minimum of $1 billion in compensation due to Matthews’ alleged misconduct.
In response, Matthews released a statement expressing their intention to “vigorously defend” themselves against the allegations. The company added, “Tesla’s lawsuit is just another tactic in their continuous effort to intimidate Matthews and unfairly acquire our valuable intellectual property.”
