Uber: Bankrupt engineer Levandowski is hiding millions from creditors

Enlarge / Anthony Levandowski in 2019.

David Paul Morris/Bloomberg by way of Getty Images

Famed self-driving engineer Anthony Levandowski was pressured to declare chapter final 12 months after he misplaced a authorized battle with Google over claims that he stole commerce secrets and techniques on behalf of Uber. Now Uber is objecting to the proposed phrases of his chapter, arguing that he used legally doubtful strategies to shelter his wealth from collectors.

Levandowski faces a skeptical chapter choose. “I continue to view many of the transactions in which Mr. Levandowski engaged immediately prior to the filing of this bankruptcy case with an incredibly jaundiced eye,” mentioned Judge Hannah Blumenstiel throughout a cellphone convention final week.

Levandowski acquired tens of thousands and thousands of {dollars} in compensation from Google in 2015 and 2016 for his work on self-driving know-how. In October 2016, Google initiated an arbitration course of to claw the cash again, arguing that Levandowski had stolen commerce secrets and techniques from Google on his means out the door. Uber alleges that Levandowski then took plenty of steps to make it troublesome for Google, Uber, or different collectors to get their a reimbursement.

Among the transactions that drew Uber’s ire: Levandowski used a donor-advised fund to funnel $175,172 to Way of the Future, an AI “church” that Levandowski based in 2017. The church obtained an in-depth write-up by our sister publication Wired in 2017. At the time, Levandowski mentioned he would obtain no wage from Way of the Future.

The focus of Uber’s objection is Levandowski’s request that courts protect from collectors $17.2 million in a Roth IRA. Tax regulation restricted Roth IRA contributions to $5,500 per 12 months when Levandowski opened it in 2016—a determine that has since risen to $6,000. So how did he accumulate $17.2 million in 5 years?

According to Uber, Levandowski deposited $4,326 in money round April 2016 and used the cash to buy 4,326,000 shares of Otto Trucking at a worth of 0.1 cents per share. When Uber acquired Otto, these shares grew to become price thousands and thousands of {dollars}. Uber says Levandowski bought half of them for $11.9 million, retaining the money contained in the IRA. He bought the remainder of the shares to his enterprise associate Robert Miller, in alternate for a $5.3 million promissory observe.

Retirement accounts are sometimes shielded from collectors in chapter proceedings. But Uber argues that rule should not apply right here as a result of Levandowski violated a number of IRA guidelines when he arrange the account. Tax regulation requires IRA cash for use for arms-length investments. Uber argues that investing in Levandowski’s personal firm does not qualify.

Uber says Levandowski additionally took different steps to protect his belongings from collectors. For instance, in 2017, he purchased a home for his father and stepmother for $949,000. He then “sold” it again to the stepmother for $720,000. Rather than paying money, she gave him an unsecured promissory observe with a balloon fee that comes due in 2048, successfully permitting her to reside within the house rent-free for 30 years.

According to Uber, Levandowski invested $250,000 in an organization based by his fiancée on March 4, 2020, the identical day he filed for chapter.

In addition, Uber says Levandowski loaned greater than $10 million to entities managed by his school pal and longtime enterprise associate Randall Miller. He funneled thousands and thousands extra to his new self-driving startup Pronto.ai.

Uber urged Judge Blumenstiel to not settle for Levandowski’s declare that he wanted the $17.2 million in his IRA to assist himself in retirement. Uber identified that Levandowski has greater than $400,000 in additional standard retirement accounts that possible shall be protected in chapter. Even if his varied different belongings are stripped away within the chapter course of, the corporate argued, the 40-year-old’s expertise as an engineer and supervisor ought to allow him to make a superb dwelling over the subsequent 20 years.

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