The AI world just got hit with some serious legal drama, and no, it’s not about robots going rogue. It’s about something just as juicy: trade secrets, stolen files, and big-money customers.
Scale AI the startup that helps tech giants prep data for training their AI models, is suing one of its former sales employees and rival startup Mercor. Why? According to Scale, this ex-employee, Eugene Ling, walked out the door with more than 100 confidential documents stuffed with customer strategies and proprietary details. Think of it as leaving a job but accidentally (or not-so-accidentally) taking the secret sauce recipe with you.
Scale’s lawsuit accuses Mercor of misusing trade secrets and Ling of breaching his contract. To make things even spicier, Scale claims Ling was already trying to pitch Mercor to one of its biggest clients (mysteriously called “Customer A”) before he officially quit. The kicker? That one client could be worth millions of dollars if Mercor won them over.
Now, Mercor’s co-founder, Surya Midha, is pushing back. He admits Ling had old Scale files on a personal Google Drive but insists Mercor never touched them. In fact, Midha says they even offered to help delete the files or resolve the situation with Scale. But Scale? They weren’t buying it.
Ling himself took to X (formerly Twitter) to say, “Yep, I’m being sued. But chill, I never used those files, I just didn’t know what to do with them. No shady business intended.” He even apologized to his new team for the mess.
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