Judge denies Wisk Aero’s request for preliminary injunction against Archer Aviation

Electric aviation startup Wisk Aero’s request for a preliminary injunction against rival Archer Aviation was denied by a federal judge Thursday, the latest in an ongoing legal battle over whether Archer stole trade secrets in developing its flagship Maker aircraft.

A full written opinion has not yet been published. In a tentative ruling filed earlier this week, Judge William Orrick said Wisk’s “evidence of misappropriation is too equivocal to warrant a preliminary injunction.” Wisk filed for the injunction in May; if it had been approved, it would have effectively put an immediate halt to Archer’s operations.

Wisk submitted to the court 52 trade secrets it alleges were stolen and used by Archer, and the injunction would have prevented Archer from using any of them until a final decision was issued in the suit. It’s an extraordinary request and it makes sense that Orrick would need to see more certain evidence of misappropriation.

“There are some arguable indications of misappropriation, but given how equivocal the evidence is, Wisk is not entitled to the extraordinary remedy of an injunction,” Orrick said in the tentative ruling. “Because the merits are so uncertain, Wisk has also not adequately shown irreparable injury based on misappropriation. And the balance of hardships favors Archer because, without solid evidence of misappropriation, an injunction would gravely threaten its business.”

Wisk says the judge’s decision on the injunction has no bearing on the outcome of the case “and does not exonerate Archer in the least.”

“We brought this lawsuit based on strong indications of theft and use of Wisk’s IP, and the initial limited evidence gathered through the court process to date only confirms our belief that Archer’s misappropriation of Wisk’s trade secrets is widespread and pervades Archer’s aircraft development,” Wisk continued. “Following today’s ruling, Wisk will be allowed to begin collecting evidence in earnest.”

Wisk was established in 2019 as a joint venture between Kitty Hawk and Boeing, but its history with electric aviation stretches back much further. The company was originally founded in 2010 as Levt, which eventually merged with sister company Kitty Hawk. Wisk says it (as Kitty Hawk) zeroed in on a fixed-wing, 12-rotor design in 2016. It’s this design that’s the centerpiece of its debut aircraft, Cora.

Archer, by contrast, is newer to the field. Much of Wisk’s original complaint, filed in April, is predicated on the speed with which Archer is bringing its air taxi service to market. Archer also recruited many former Wisk engineers — including former employee Jing Xue, whom Wisk says downloaded nearly 5,000 files before his departure from the company, which it alleges he handed over to Archer.

When he was cross-examined, Xue pled the Fifth Amendment, invoking his right to not self-incriminate, citing an ongoing federal investigation.

Archer says Wisk has not brought forward any substantive evidence of the central claim of the lawsuit: that Archer received and used Wisk trade secrets. Wisk’s allegations are based on “conspiracy theories and outright misrepresentations,” Archer’s Deputy General Counsel Eric Lentell said.

“It is clear to us from Wisk’s actions in this case that after recognizing Archer’s momentum and pace of innovation, Wisk began abusing the judicial and criminal justice system in an attempt to slow us down to compensate for its own lack of success,” Archer co-founders Brett Adcock and Adam Goldstein said.

The court will hold a scheduling conference on August 11, where the judge will outline next steps for the case. A date for the trial has not been set.

The case is filed in the California Northern District Court under case no. 3:2021cv02450.