Tesla claims rival startup is built on stolen trade secrets originally appeared on TheStreet.

Most people are waiting early for news on Tesla’s (TSLA) planned robotaxi rollout, an event that CEO Elon Musk has been hyping up for months.

With the buzz surrounding this well-publicized event, one that could usher in a new era for the automotive transportation industry, it can be easy to overlook Tesla’s updates in other areas. But the company recently revealed that it may face a new challenge from a competitor in a different part of the sector.

On Wednesday, June 11, Tesla filed a complaint in a San Francisco Federal Court, accusing a former employee of leaving the company with illegal material that may have been used to launch another company, which several prominent venture capitalists have backed.

Now this startup is threatening Tesla’s progress in a fast-growing market, and Musk’s company is taking legal action in an attempt to avoid loss of market share.

Tesla reveals aggressive legal strategy to stop rival
Over the past few years, Tesla’s Optimus program, its division that focuses on developing humanoid robot technology, has come into focus as Musk has touted its progress. He’s discussed a future in which robots outnumber humans and perform many of the tasks typically done by humans.

That may sound like something out of a work of science fiction, but Tesla’s more recent news reads more like something out of a novel by John Grisham or Scott Turow. The company is suing a former employee who left the company and promptly started a competitor, allegedly with stolen trade secrets.

Zhongjie “Jay” Li spent two years at Tesla, serving as a Technical Lead between August 2022 and September 2024. During this time, he “advanced robotic hand sensors — and was entrusted with some of the most sensitive technical data in the program,” according to the company’s attorneys.

When he left Tesla, though, Li allegedly walked away with highly classified information that the company believes he used to launch Proception.ai, listed as being launched the same month that he departed. The startup’s LinkedIn profile states that it creates “humanoids dexterous enough to thread a needle.”

Tesla’s complaint lays out his case against Li, stating that “Within just five months, Proception publicly claimed to have ‘successfully built’ advanced humanoid robotic hands — hands that bear a striking resemblance to the designs Li worked on at Tesla.”