Side Note: Troutman Pepper has formed a Corporate Espionage Response Team to help clients combat the increasing incidence of corporate espionage.
Arthur AI, a New York-based AI company, received a request for a Zoom demonstration of its technology from a startup called OneOneThree. The head of technology at OneOneThree, Yan Fung, expressed interest in purchasing Arthur AI’s technology. But there were some immediate red flags.
First, prior to the Zoom meeting, Arthur AI employees recognized that OneOneThree had no website. The Timesarticle says that Fung told Arthur AI at the time that OneOneThree was in “stealth mode,” which is why it had no website. Then, when Arthur AI asked Fung to sign a nondisclosure agreement (NDA), he reportedly asked Arthur AI to “hold off on the NDA,” and Arthur AI agreed.
Despite these issues, a Zoom meeting was arranged to demo the technology. Fung said Karina Patel, OneOneThree’s “main engineer,” would dial in to the meeting. However, during the Zoom meeting, an attendee logged in under the name of Aparna Dhinakaran, which an Arthur AI employee immediately recognized as a founder of Arize AI, a rival startup. When recognized, the attendee quickly logged off. Arthur AI later deduced that Fung was, in fact, an employee of Arize AI named Dat Ngo, and OneOneThree was an inactive company of his.
After the call concluded, one of Arthur AI’s employees messaged Ngo via LinkedIn direct messaging. Ngo responded by trying to recruit the Arthur AI employee, according to the Times article. more
Lessons Learned:
Despite these issues, a Zoom meeting was arranged to demo the technology. Fung said Karina Patel, OneOneThree’s “main engineer,” would dial in to the meeting. However, during the Zoom meeting, an attendee logged in under the name of Aparna Dhinakaran, which an Arthur AI employee immediately recognized as a founder of Arize AI, a rival startup. When recognized, the attendee quickly logged off. Arthur AI later deduced that Fung was, in fact, an employee of Arize AI named Dat Ngo, and OneOneThree was an inactive company of his.
After the call concluded, one of Arthur AI’s employees messaged Ngo via LinkedIn direct messaging. Ngo responded by trying to recruit the Arthur AI employee, according to the Times article. more
Lessons Learned:
- Require NDAs Every Time.
- Perform Proper Due Diligence and Act Consistently With Your Findings.
- Only Use Secure Communication Channels and Restrict Recording.
- Train Employees on Spotting and Responding to Potential Threats.
- Conduct a Prompt and Careful Investigation Into Suspected Activity.
