Fitbit did not steal Jawbone’s trade secrets, according to a
ruling issued on Tuesday by the US International Trade Commission
The case began when Jawbone accused Fitbit of poaching its
employees and using their knowledge of Jawbone’s trade secrets.
Jawbone also claimed that Fitbit violated some of Jawbone’s
patents. Jawbone’s hope was that the ITC would ban Fitbit from
importing its products to the US from its overseas manufacturing
Jawbone and Fitbit make devices overseas and import them to the
The ruling means that Fitbit will be able to continue to import
its products to the US and sell them.
“[N]o party has been shown to have misappropriated any
trade secret,” the ITC ruling reads.
“We are pleased with the ITC’s initial determination rejecting
Jawbone’s trade secret claims,” said Fitbit CEO James Park
said in a statement to Business Insider. “We greatly appreciate
the ALJ’s [administrative law judge’s] time and diligent work
on this case. From the outset of this litigation, we have
maintained that Jawbone’s allegations were utterly without merit
and nothing more than a desperate attempt by Jawbone to disrupt
Fitbit’s momentum to compensate for their own lack of
success in the market.”
A Jawbone representative provided a statement, saying
that the company intends to ask for a review of the ITC ruling.
“We intend to seek review of today’s ruling before the full
Commission,” the rep said. “The case in the ITC involved a very
small subset of Jawbone’s trade secrets asserted against
Flextronics and Fitbit because of the limited jurisdiction of the
ITC. Jawbone is continuing to pursue its much broader trade
secret case against Fitbit, which is headed to a jury trial in
California state court. The California court already has granted
a preliminary injunction and rejected Fitbit’s efforts to dismiss
the case. Jawbone is confident it will prevail when the full
scope of its claims is heard by the jury.”
The ITC invalidated the last of Jawbone’s patent claims in April,
and the case came down only to Jawbone’s accusation that Fitbit
stole Jawbone’s trade secrets.
Fitbit is the most popular wearable-device maker with almost 25%
global market share at the end of the first quarter of 2016,
to research firm IDC. Jawbone’s market share is too small to
crack IDC’s list of top wearable device makers.
The ITC decision was something Jawbone had hoped would be in its
favor. This spring, Jawbone’s CEO, Hosain Rahman, told
Business Insider that he felt confident the ITC would ban
Fitbit from importing its products, giving Jawbone the advantage
But as the case dragged on, Jawbone has had its share of
troubles. It raised a new round of funding — $165 million — in
January at about half its previous valuation: $1.65 billion
versus its previous valuation of $3.3 billion,
according to Recode. Jawbone declined to comment on its
Sameer Samat, a Google executive hired as Jawbone’s
president, left the company and returned to Google in January
after less than a year on the job.
Jawbone has also tried to sell its Jambox Bluetooth
speaker business, a source familiar with Jawbone’s plans
told Business Insider earlier this year. But Jawbone’s hope was
that a buyer would pay a premium for the Jambox brand. The
company hasn’t had any luck finding a buyer, according to the
source. A Jawbone representative says that there are
several parties interested in the Jambox business.
Jawbone also hasn’t released a new fitness tracker since
spring 2015 and has sold inventory to a third-party reseller, a
source told Business Insider this spring. The company says that
it remains committed to making wearables. A Jawbone rep says
the company still has fitness-tracker inventory.
Most of Jawbone’s effort has gone into developing a new
“clinical grade” wearable that can track health data like
blood pressure, according to a source. Rahman, Jawbone’s CEO,
also told Business Insider this spring that Jawbone was
interested in exploring clinical wearables.
But, Jawbone had problems getting the clinical device to work
properly as recently as this spring, the source said. A Jawbone
representative denies the company has had problems with the
Most recently, Jawbone lost its head of product, Travis
Bogard, in July,
Lauren Goode of The Verge first reported.
Jawbone just lost its big case against Fitbit – Business Insider