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.
💵💰Don’t miss the move: Subscribe to TheStreet’s free daily newsletter💰💵
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 CEO Elon Musk has brought a lawsuit against a company launched by a former employee.
Image source: Zawrzel/NurPhoto via Getty Images
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.
Related: Elon Musk finally gets some good news from Jeff Bezos
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.”
More Tesla News:
Tesla rival gets good news as robotaxi launch loomsThe ‘anti-Tesla’ gives American buyers more good newsTesla makes a desperate move as it continues to lose customers
Proception.ai did not immediately respond to an inquiry from TheStreet regarding the lawsuit, and so far, has not issued a public statement on Tesla’s accusations. However, Li has posted to X recently, implying — but not explicitly stating — that he doesn’t trust Musk.
Tesla is facing a growing list of challenges for its robotics expansion
Musk has staked much of Tesla’s growth prospects on its robotaxi launch and its plans to advance into the humanoid robotics market. However, the lawsuit against Li isn’t the only potential hurdle for the company to overcome as it rushes to usher in a turnaround.
Related: Tesla faces new challenge as leader announces exit
Early in June, Tesla lost one of its engineering leaders, as Vice President of Engineering Milan Kovic announced he would step down from his role at Optimus, effective immediately. He said his decision had nothing to do with Musk and purely reflected his own desire to spend more time with family.
Even so, Musk’s robotaxi ambitions are facing a growing list of challenges at a highly pivotal time. The company’s declining sales across the U.S., Europe, and China indicate that it will need to make progress in other areas to remain competitive and keep shares elevated, despite Musk’s decision to return to the company.
Tesla has teased progress from its robotics division, including sharing a video of a dancing robot. But Proception claims to have overcome one of robotics’ biggest challenges, that of creating a hand that can truly match human dexterity.
It remains unknown how the lawsuit will progress. But in the short term, Tesla must deal with the fact that a new rival appears to be making progress in an important area.
