Intel sues ex-employee for USB stick Xeon files theft

Top Secret

An Intel staffer who left the company to join Microsoft walked out the door with a USB stick holding 3,900 confidential files about the Xeon processor, his former employer alleges.

Intel accuses Dr. Varun Gupta of trade secrets file theft. According to documents filed in the US District Court in Portland, Oregon, Gupta worked at an Intel facility in Portland for almost ten years, in product marketing and strategic planning and business development.

He left in January 2020 to join Microsoft as a Principal for Strategic Planning in Cloud and AI. At Intel he had access to Xeon processor documents about pricing structure and strategies, parameter definition and manufacturing capabilities.

On his last day at the company, Gupta is alleged to have copied about 3,900 documents onto a Seagate FreeAgent GoFlex USB drive bearing an identified serial number. According to Intel he also copied information onto a Western Digital My Passport USB drive, also with an identified serial number. Some of the files were marked ‘Intel Top Secret and ‘Intel Confidential’.

In its court filing, Intel accuses Gupta of “deploying that information [in his role at Microsoft] in head-to-head negotiations with Intel concerning customised product design and pricing for significant volumes of Xeon processors”.

Specifically, he “used that confidential information and trade secrets to gain an unfair advantage over Intel in the negotiations concerning product specifications and pricing. Gupta had no way of knowing this information but for his access to it during his employment at Intel.”

An Intel security team began an investigation to determine the nature and scope of Gupta’s knowledge. With the assistance of Microsoft, “forensic analysis ultimately showed that Gupta had taken thousands of Intel documents, placed them on one or more of at least two USB drives (including the Seagate Drive), and accessed them on multiple dates throughout his employment by Microsoft.”

For example, “forensic analysis revealed that between February 3, 2020 and July 23, 2020, Gupta plugged the Western Digital Drive into his MS Surface at least 114 times.” Documents accessed included ”a slide deck relating to Intel’s confidential engagement strategy and product offerings for Xeon customised processors.”

After first denying he had the Seagate drive, “Gupta admitted to Microsoft that he did in fact have the Seagate Drive in his possession and only then that he turned it over to Microsoft for analysis.” Microsoft then commissioned a forensic analysis of the Seagate Drive. The Western Digital drive has not been found.

Intel seeks a jury trial and wants damages of at least $75,000, payment of its legal fees, and a restraining order preventing Gupta from using any confidential Intel information.

Gupta denies Intel’s claims.