CREATEAI HOLDINGS, INC. (f/k/a TUSIMPLE HOLDINGS, INC.), Appellant, v. BOT AUTO TX INC., Appellee.
No. 15-25-00001-CV
In the Fifteenth Court of Appeals
April 23, 2025
On Appeal from the Eleventh Division of the Texas Business Court, Harris County, Texas, Trial Court Cause No. 24-BC11A-0007. Accepted April 23, 2025. Filed in 15th Court of Appeals, Austin, Texas. Christopher A. Prine, Clerk.
Joseph A. Fischer, III, lead counsel
Texas Bar No. 00789292
tfischer@jw.com
Leisa Talbert Peschel
Texas Bar No. 24060414
lpeschel@jw.com
Victoria C. Emery
Texas Bar No. 24126228
temery@jw.com
JACKSON WALKER LLP
1401 McKinney, Suite 1900
Houston, Texas 77010
Telephone: (713) 752-4530
Facsimile: (713) 308-4130
Allison Allman
Texas Bar No. 24094023
aallman@jw.com
JACKSON WALKER LLP
777 Main Street, Suite 2100
Fort Worth, Texas 76102
Telephone: (817) 334-7200
Facsimile: (817) 334-7290
Counsel for Appellee Bot Auto TX Inc.
ORAL ARGUMENT NOT REQUESTED
Pursuant to
Appellant
CreateAI Holdings, Inc. (formerly known as TuSimple Holdings, Inc.)
Counsel for Appellant
Timothy J. McCarthy
Texas Bar No. 24123750
tmccarthy@dykema.com
Cliff P. Riley
Texas Bar No. 24094915
criley@dykema.com
Salvador J. Robles
Texas Bar No. 24121800
srobles@dykema.com
Aaron J. Kotulek
Texas Bar No. 24137483
akotulek@dykema.com
DYKEMA GOSSETT PLLC
1717 Main Street, Suite 4200
Dallas, Texas 75201
Telephone: (214) 462-6400
Facsimile: (214) 462-6401
Isaac Villarreal
Texas Bar No. 24054553
ivillareal@dykema.com
Amanda Gordon
State Bar No. 24103737
agordon@dykema.com
DYKEMA GOSSETT PLLC
5 Houston Center
1401 McKinney St., Suite 1625
Houston, Texas 77010
Telephone: (713) 904-6900
Facsimile: (713) 904-6401
Bot Auto TX Inc.
Counsel for Appellee
Joseph A. Fischer, III
Texas Bar No. 00789292
tfischer@jw.com
Leisa Talbert Peschel
Texas Bar No. 24060414
lpeschel@jw.com
Victoria C. Emery
Texas Bar No. 24126228
temery@jw.com
JACKSON WALKER LLP
1401 McKinney, Suite 1900
Houston, Texas 77010
Telephone: (713) 752-4530
Facsimile: (713) 308-4130
Allison Allman
aallman@jw.com
Texas Bar No. 24094023
777 Main Street, Suite 2100
JACKSON WALKER LLP
Fort Worth, Texas 76102
Telephone: (817) 334-7200
Facsimile: (817) 334-7290
Identities of Parties and Counsel ...................................................................i
Table of Contents .........................................................................................iii
Table of Authorities..................................................................................... vii
Statement of the Case.................................................................................. xii
Statement Regarding Oral Argument......................................................... xiv
Issue Presented [Restated].......................................................................... xv
Statement of Facts......................................................................................... 5
I. Factual Background................................................................................. 5
A. TuSimple‘s Beginning (n/k/a CreateAI)............................................ 5
1. TuSimple completed a hub-to-hub demo in 2018.......................6
2. Cheng Lu joined TuSimple as CFO in 2019. ................................ 7
B. TuSimple‘s Turmoil: Infighting, Lawsuits, and Investigations. ........ 7
1. TuSimple explored a potential partnership with Mr. Chen‘s China-based Hydron....................................................................9
2. TuSimple fired Dr. Hou on October 30, 2022 and dismantled its autonomous trucking program in the summer of 2023......................................................................... 10
3. TuSimple‘s internal “investigations” found no wrongdoing.......11
C. Bot Auto‘s Fresh Start: Artificial Intelligence, New Tools, and Success............................................................................................. 13
1. With emergent AI, Bot Auto starts fresh. .................................. 13
a. TuSimple‘s convolutional neural network (CNN) had to manually train the AI model................................................ 14
c. Bot Auto‘s pretrained transformer neural network (TNN) no longer needs sensor fusion. ................................. 16
d. In addition to new AI, Bot Auto‘s system and infrastructure is based on more efficient open-source technology that was not available when TuSimple‘s system was created. ..............................................................17
e. Bot Auto‘s sensor technology takes advantage of new improvements in components. ............................................ 18
2. Dr. Hou leverages autonomous vehicle basics at Bot Auto. ...... 19
a. A suite of sensors gives the truck perception.......................20
b. AI helps the truck make decisions. ......................................23
c. Redundancies make all trucks safer. ...................................23
3. Dr. Hou protected Bot Auto‘s technology from contamination by any outside source—including TuSimple. ....24
D. TuSimple‘s Failure: Liquidation Dispute, Pivot to Anime, and this Lawsuit. ...........................................................................................26
II. Prоcedural Background.........................................................................28
A. CreateAI‘s Application for Temporary Injunction...........................28
B. Two-Day Temporary Injunction Hearing........................................29
1. Dr. Hou testified for Bot Auto, refuting CreateAI‘s speculation and claims. .............................................................30
2. Mr. Lu testified for CreateAI but offered no support for an injunction................................................................................... 31
3. The trial court properly denied the injunction. .........................33
C. Bot Auto‘s Counterclaims. ...............................................................33
Legal Standard ............................................................................................ 37
Argument ....................................................................................................39
I. The Trial Court Properly Denied the Injunction. ..................................39
A. CreateAI failed to state a TUTSA claim. ..........................................39
1. CreateAI failed to identify any information entitled to trade secret protection...............................................................40
a. The alleged “trade secrets” are not adequately defined. ...... 41
b. The alleged “trade secrets” are publicly available and not adequately protected. .................................................... 45
B. CreateAI failed to demonstrate a probable right to recover on its TUTSA claim....................................................................................48
1. CreateAI failed to prove any alleged trade secret was acquired through improper means............................................48
2. CreateAI failed to prove any use or threatened use of an alleged trade secret. ...................................................................50
a. CreateAI‘s support—two pre-TUTSA cases—examined evidence of actual trade secret possession by a competitor not present here. ................................................51
b. Bot Auto is not using, and is not in a position to use, CreateAI‘s sensor-suite technology...................................... 56
c. Bot Auto is not using, and is not in a position to use, CreateAI‘s decision-making technology............................... 57
d. Bot Auto is not using, and is not in a position to use, CreateAI‘s safety technology................................................ 59
C. CreateAI failed to show a probable, imminent, irreparable injury..60
1. Injury is not probable; CreateAI‘s TUTSA claim fails foundationally for lack of trade secrets. ....................................62
3. Injury is not irreparable (CreateAI is trying to license—monetize—its alleged trade secrets). .........................................64
D. CreateAI failed to carry its trial and appellate burdens................... 65
Prayer ..........................................................................................................66
Certificate of Compliance ............................................................................68
Certificate of Service....................................................................................68
Cases
Abbott v. Anti-Defamation League Austin, Sw., & Texoma Regions, 610 S.W.3d 911 (Tex. 2020) (per curiam) ........................................ 37, 38Amend v. Watson, 333 S.W.3d 625 (Tex. App.—Dallas 2009, no pet.).......................... 38, 59
Bianco v. Globus Med., Inc., No. 2:12-CV-00147-WCB, 2014 WL 1049067 (E.D. Tex. Mar. 17, 2014)........................................................................................ 62
Butnaru v. Ford Motor Co., 84 S.W.3d 198 (Tex. 2002)............................................... 38, 65
CAE Integrated, L.L.C. v. Moov Techs., Inc., 44 F.4th 257 (5th Cir. 2022)............................. 50, 58
Camp v. Shannon, 348 S.W.2d 517 (Tex. 1961) .................................................................... 29
Cardinal Health Staffing Network, Inc. v. Bowen, 106 S.W.3d 230 (Tex. App.—Houston [1st Dist.] 2003, no pet.).................................................................................................................... 55
Conley v. DSC Commc‘ns Corp., No. 05–98–01051–CV, 1999 WL 89955 (Tex. App.—Dallаs Feb. 24, 1999, no pet.) ............................................................................................ 55
Cooper Valves, LLC v. ValvTechnologies, Inc., 531 S.W.3d 254 (Tex. App.—Houston [14th Dist.] 2017, no pet.).................................................................................................................... 42
Dallas Hous. Auth. v. Nelson, No. 05–13–00818–CV, 2015 WL 1261953 (Tex. App.—Dallas Mar. 19, 2015, pet. denied) (mem. op.) ...................................................................38
ECT Int‘l, Inc. v. Zwerlein, 597 N.W.2d 479 (Wis. Ct. App. 1999)......................................... 43
EMSL Analytical, Inc. v. Younker, 154 S.W.3d 693 (Tex. App.—Houston [14th Dist.] 2004, no pet.).............................................................................................. 38, 65
FMC Techs., Inc. v. Murphy, 679 S.W.3d 788 (Tex. App.—Houston [1st Dist.] 2023, pet. denied)............................................................................................................. 46
Frey v. DeCordova Bend Estates Owners Ass‘n, 647 S.W.2d 246 (Tex. 1983) ...................... 62
Galtex Prop. Invs., Inc. v. City of Galveston, 113 S.W.3d 922 (Tex. App.—Houston [14th Dist.] 2003, no pet.)..........................................................................................................64
GE Betz Inc. v. Moffitt-Johnson, 301 F. Supp. 3d 668 (S.D. Tex. 2014)................................ 42
Harbor Perfusion, Inc. v. Floyd, 45 S.W.3d 713 (Tex. App.—Corpus Christi 2001, no pet.).......61
Henry v. Cox, 520 S.W.3d 28 (Tex. 2017) .............................................................................38
Hilb, Rogal & Hamilton Co. v. Wurzman, 86 S.W.2d 30 (Tex. App.—Dallas 1993, no writ) ...... 33
IAC, Ltd. v. Bell Helicopter Textron, Inc., 160 S.W.3d 191 (Tex. App.—Fort Worth 2005, no pet.) ...............................................................................................................passim
Imax Corp. v. Cinema Techs., Inc., 152 F.3d 1161 (9th Cir. 1998).......................................... 43
INEOS Grp. Ltd. v. Chevron Phillips Chem. Co., LP, 312 S.W.3d 843 (Tex. App.—Houston [1st Dist.] 2009, no pet.).......................................................................................................... 59
Luccous v. J. C. Kinley Co., 376 S.W.2d 336 (Tex. 1964).................................................... 45
Mabrey v. SandStream, Inc., 124 S.W.3d 302 (Tex. App.—Fort Worth 2003, no pet.)............ 64
Metallurgical Indus. Inc. v. Fourtek, Inc., 790 F.2d 1195 (5th Cir. 1986) .................................. 43
Midway CC Venture I, LP v. O&V Venture, LLC, 527 S.W.3d 531 (Tex. App.—Houston [1st Dist.] 2017, no pet.).......................................................................................................... 65
N. Cypress Med. Ctr. Operating Co., Ltd. v. St. Laurent, 296 S.W.3d 171 (Tex. App.—Houston [14th Dist.] 2009, no pet.)...........................................................................................................61
Neurodiagnostic Consultants, LLC v. Nallia, No. 03-18-00609-CV, 2019 WL 4231232 (Tex. App.—Austin Sept. 6, 2019, no pet.) (mem. op.) ........................................................... 39
Nichia Corp. v. Everlight Elecs. Co., No. 02:13-CV-702-JRG, 2016 WL 310142 (E.D. Tex. Jan. 25, 2016), aff‘d sub nom., Nichia Corp. v. Everlight Americas, Inc., 855 F.3d 1328 (Fed. Cir. 2017) ................................................................................................... 64, 65
Palliative Plus LLC v. A Assure Hospice, Inc., No. 03-23-00770-CV, 2025 WL 284920 (Tex. App.—Austin Jan. 24, 2025, no pet. h.) (Field, J.) ....................................................... 39
Phazr, Inc. v. Ramakrishna, No. 3:19-CV-01188-X, 2020 WL 5526554 (N.D. Tex. Sept. 14, 2020) (Starr, J.)...................................................................................................................... 55
Ramirez v. Ignite Holdings, Ltd., No. 05-12-01024-CV, 2013 WL 4568365 (Tex. App.—Dallas Aug. 26, 2013, no pet.)............................................................................................ 42
Retail Servs. WIS Corp. v. Crossmark, Inc., No. 05-20-00937-CV, 2021 WL 1747033 (Tex. App.—Dallas May 4, 2021, pet. denied) (mem. op.)..................................................................... 42
Roberson v. Robinson, 768 S.W.2d 280 (Tex. 1989)...................................................................38
Shamoun & Norman, LLP v. Yarto Intern. Grp., LP, 398 S.W.3d 272 (Tex. App.—Corpus Christi 2012, pet. dism‘d)................................................................................................................. 4, 50
Shenzhen Chengront Tech. Co., Ltd. v. Besign Direct, No. 1:22-CV-10281-JLR, 2022 WL 17741496 (S.D.N.Y. Dec. 9, 2022) ................................................................................................................... 63
Shor v. Pelican Oil & Gas Mgmt., LLC, 405 S.W.3d 737 (Tex. App.—Houston [1st Dist.] 2013, no pet.)......................................................................................................................... 59
SL Montevideo Tech., Inc. v. Eaton Aerospace, LLC, No. Civ. 03-3302 RHK/FLN, 2006 WL 1472860, at *3 (D. Minn. May 26, 2006), aff‘d on other grounds, 491 F.3d 350 (8th Cir. 2007)......................................................................................................... 43
Spear Marketing, Inc. v. BancorpSouth Bank, 791 F.3d 586 (5th Cir. 2015)....................................................................................................................... 55
St. Jude Med. S.C., Inc. v. Janssen-Counotte, No. A-14-CA-00877-SS, 2015 WL 11438611 (W.D. Tex. Oct. 30, 2015)...........................................................................................................55, 57
St. Jude Med. S.C., Inc. v. Janssen-Counotte, No. A-14-CA-877-SS, 2014 WL 7237411 (W.D. Tex. Dec. 17, 2014)...................................................................................................................40
State v. Hollins, 620 S.W.3d 400 (Tex. 2020) (per curiam)....................................... 38, 65
Sw. Rsch. Inst. v. Keraplast Techs., Ltd., 103 S.W.3d 478 (Tex. App.—San Antonio, 2003, no pet.) ..................... 45
T-N-T Motorsports v. Hennessey Motorsports, 965 S.W.2d 18 (Tex. App.—Houston [1st Dist.] 1998).........................................................................................passim
T2 Modus, LLC v. Williams-Arowolo, No. 4:22-CV-00263, 2023 WL 6221429 (E.D. Tex. Sept. 25, 2023) .....................................................................................................................44
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Tewari De-Ox Sys., Inc. v. Mountain States/Rosen, L.L.C., 637 F.3d 604 (5th Cir. 2011)................................................................................................... 45
Topstone Commc‘ns, Inc. v. Xu, 729 F. Supp. 3d 701 (S.D. Tex. 2024)................................ 43, 45
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Statutes
Nature of the Case: This appeal arises from the trial court‘s discretionary denial of plaintiff‘s temporary injunction application for the alleged misappropriation of trade secrets. CR.1091–92.1
Course of Proceedings: Dr. Xiaodi Hou (“Dr. Hou“) co-founded Appellant TuSimple Holdings, Inc. (now known as CreateAI Holdings, Inc. (“CreateAI“) after a name change following its pivot away from autonomous trucking to anime and videogames).2 At TuSimple, Dr. Hou developed the world‘s first hub-to-hub demo for autonomous trucks. CR.0807–23. Amid significant interpersonal, strategic, managerial, and operational conflicts, Dr. Hou left TuSimple in 2022 and started Appellee Bot Auto TX Inc. (“Bot Auto“) in 2023. Bot Auto has achieved remarkable success in less time and with less funding—not because of TuSimple/CreateAI‘s alleged trade secrets (which are not secret and nonetheless outdated and useless to Bot Auto)—but because Bot Auto utilizes different artificial intelligence technology, only recently made available.
On October 1, 2024, CreateAI sued Bot Auto for trade secret misappropriation under the Texas Uniform Trade Secrets Act (“TUTSA“), seeking injunctive relief and dаmages, on the basis of its suspicion that Bot Auto‘s success “could not be even colorably true” unless Bot Auto was using CreateAI‘s alleged trade secrets. CR.6–38, 27, 50. The trial court (the Honorable Sofia Adrogué) denied CreateAI‘s application for a temporary injunction on December 28, 2024. CR.1091–92.
The case is ongoing at the trial court level with discovery proceeding on CreateAI‘s TUTSA claim and Bot Auto‘s counterclaims. Bot Auto also filed a traditional and no evidence motion for summary judgment against CreateAI‘s TUTSA claim based on CreateAI‘s failure to identify its alleged trade secrets with reasonable particularity sufficient to distinguish the alleged “trade secrets” from common practice and publicly disclosed information, such as the disclosures in CreateAI‘s extensive patent portfolio. SCR.594–2176. This motion is set for hearing on May 8, 2025.
This appeal concerns only whether the trial court abused its discretion in denying CreateAI‘s application for a temporary injunction.
Trial Court‘s Disposition: After written discovery, document productions, and depositions of each party‘s principal witness (Bot Auto‘s CEO Dr. Hou and CreateAI‘s CEO Cheng Lu),3 the trial court (the Honorable Sofia Adrogué) resolved various discovery disputes, presided over a two-day evidentiary hearing on November 18 and 19, 2025, and considered five briefs from the parties before denying CreateAI‘s application for a temporary injunction on December 28, 2024. CR.1091–92. The trial court did not issue (nor was it required to) any findings of fact or conclusions of law. CR.1094.
This appeal presents no complex or novel issues of law—e.g., trade secrets must be secret—and nо basis for overturning the discretionary decision of the trial court. Appellee believes oral argument is not necessary given the straightforward issues. Appellee welcomes the opportunity to discuss these matters with the Court if it holds argument.
Did the trial court abuse its discretion in denying a temporary injunction when CreateAI offered only speculation and failed to meet its burden to plead a cause of action and show a probable right to recover with respect to (1) trade secrets;5 (2) Bot Auto‘s use or even position to use the alleged “trade secrets“;6 and (3) probable, imminent, and irreparable injury?7
Laid bare, CreateAI argues, because it alleged trade secret misappropriation based on its speculation Bot Auto could not have achieved its development milestones without stealing, CreateAI was entitled to a presumption of harm, thus it was entitled to a temporary injunction, and thus the trial court abused its discretion by not accepting its allegations as true, presuming harm, and pro forma granting it a temporary injunction.
There is no right to a temporary injunction, even in a trade secrets case, nor can mere allegations or speculation support one. The evidentiary burden to obtain a temporary injunction is high, and the burden to show there was
After a two-day evidentiary hearing, in which the trial court heard testimony from Bot Auto‘s Dr. Xiaodi Hou, who built its technology from the ground up with only newly available artificial intelligence (“AI“) tools, and CreateAI‘s Mr. Cheng Lu, who lacks personal knowledge of the technology at issue, the trial court determined a preliminary injunction was not warranted. The trial court was well-within its discretion to deny CreateAI‘s application; indeed, the evidence only supported denial.
CreateAI‘s “trade secrets” are not secret; Bot Auto is not using or in a position to use them; and money damages could remedy any potential harm. CreateAI offered only vague, highly-abstracted descriptions of its “trade secrets” and made no effort to meet its burden to describe them with the required detail and distinguish them from common practice and publicly disclosed information, such as the disclosures in CreateAI‘s extensive patent portfolio. It presented no direct evidence of misappropriation, either.
In contrast, Bot Auto had no burden but presented evidence that the supposed “trade secrets” are publicly available. Bot Auto‘s testimony on public disclosure went unrebutted as did Bot Auto‘s evidence it has no use for the “trade secrets” because its independently developed technology is
CreateAI expresses incredulousness about Bot Auto‘s rapid success. But it lacks trade secrets and evidence of misappropriation; allegations and suspicion, no matter how hyperbolic, do not support a presumption of harm or automatic extraordinary relief. As the trial court warned from the outset, “It‘s not going to issue on mere surmise.” 2.RR.37. And yet, after weeks of discovery, depositions, and a two-day evidentiary hearing, mere surmise is all CreаteAI offered—the trial court‘s denial of the injunction was both correct and within its discretion.
CreateAI bore the burden to present evidence of a probable trade secret claim. Instead, it speculated Bot Auto‘s success “could not be even colorably true” unless Bot Auto was using its alleged trade secrets—pointing to
CreateAI failed to meet its burden to plead a cause of action and show a probable right to recover with respect to (1) trade secrets; (2) threatened use; and (3) irreparable harm; its insistence on a presumption underscores this. Failure to satisfy any one of those elements is fatal; CreateAI failed all three. The trial court was well within its wide discretion to find that CreateAI failed its burden and deny its application. Denial should be affirmed.
I. Factual Background
Dr. Xiaodi Hou is the world-renowned computer scientist who founded both CreateAI (where he achieved ground-breaking milestones in autonomous trucking but whose tenure as CEO was cut short by corporate infighting) and Bot Auto (where he is using newly available technology made possible by recent advancements in AI).12
A. TuSimple’s Beginning (n/k/a CreateAI).13
Dr. Hou graduated from Shanghai Jiao Tong University with a computer science degree, and was the first Chinese undergraduate student to publish in multiple world-renowned AI and machine learning conferences. 8.RR.174; 5.RR.51–55. Dr. Hou then joined the Computation and Neural Systems program at the California Institute of Technology, where he earned a Ph.D. and focused his ground-breaking research on computer vision and machine learning, psychophysics, and electrophysiology. 8.RR.174.
1. TuSimple completed a hub-to-hub demo in 2018.
Dr. Hou and his team achieved the first hub-to-hub15 demo for Level-416 autonomous trucks in 2018. 5.RR.63. Since then, several other autonomous trucking companies have achieved the hub-to-hub milestone. See 5.RR.40. But at the time, it was a remarkable feat that required an extraordinary investment of money, time, and effort with the then-state-of-the-art, labor-intensive technology.17 As the first autonomous trucking
2. Cheng Lu joined TuSimple as CFO in 2019.
In 2019, a year after the hub-to-hub milestone, Mr. Cheng Lu was hired as the Chief Financial Officer and later promoted to CEO in anticipation of TuSimple going public. 8.RR.175; 6.RR.82. Mr. Lu used his MBA and experience in private equity and venture capital firms to market TuSimple to investors, which resulted in a successful IPO in April 2021. 8.RR.175; 6.RR.82.
Dr. Hou continued to develop the technology. After five years of research and development, TuSimple achieved “driver-out” operations (no human intervention) in December 2021. 5.RR.12, 63.
B. TuSimple’s Turmoil: Infighting, Lawsuits, and Investigations.
While Dr. Hou and Mr. Lu shared the goal of commercializing autonomous trucking, their different backgrounds, expertise, and priorities led to an irreconcilable conflict about the best way to achieve it. 8.RR.175–76. Dr. Hou prioritized developing the technology to achieve profitable commercial operations. Id. Mr. Lu focused solely on revenue, rapidly expanding operations and offering prices well-below TuSimple’s break-even point because he believed investors wanted startup revenue over profit. Id.
TuSimple’s meteoric rise as the “darling of the autonomous driving industry” was short-lived. 5.RR.225. The personality conflicts and conflicting priorities rendered the company incapable of handling the series of setbacks it was dealt in 2022—including video footage of a TuSimple truck crashing into a highway barrier, resulting in the first of many lawsuits against the company—a class action by TuSimple shareholders. See 5.RR.239–40, 243–45, 247–48. Then came two derivative class actions, one in early 2023 in Delaware and one in late 2023 in California. 5.RR.240–41. All three are ongoing. See CR.1102–03.
In addition to lawsuits, the Committee on Foreign Investment in the United States (“CFIUS”) investigated TuSimple. 5.RR.244. CFIUS investigates domestic entities that receive foreign investments, and TuSimple is supported by a Chinese entity (SINA Corporation). The CFIUS investigation resulted in TuSimple entering into a National Security Agreement (“NSA”) in February 2022 to prevent proprietary information that may implicate national security from being shared with foreign entities (“Covered IP”). CR.719; 5.RR.92; 6.RR.120.
For TuSimple to achieve commercialization, it needed to partner with an original equipment manufacturer (“OEM”). In March of 2022, when Dr. Hou took over as CEO, TuSimple was struggling to find one. 5.RR.94–95. Dr. Hou met and shared information with several OEMs, including Volvo, Hyundai, and Hydron (a Chinese company owned by TuSimple’s co-founder, Mr. Chen).18 Id. Dr. Hou did not disclose any Covered IP or trade secrets to Hydron, only the information that TuSimple regularly provided to potential OEM partners.19
But concern over the potential TuSimple/Hydron partnership led to two investigations—one external by CFIUS into whether Covered IP was shared in violation of the NSA and one internal led by Sullivan & Cromwell to determine whether there was a related-party transaction. See 5.RR.227; 6.RR.120. Neither investigation found wrоngdoing, but TuSimple’s capital and reputation nonetheless were further damaged. See CR.17. Additionally, false reports by the Wall Street Journal (claiming the FBI was investigating TuSimple and Dr. Hou for corporate espionage) as well as rising tensions between the U.S. and China contributed to an atmosphere of distrust at
2. TuSimple fired Dr. Hou on October 30, 2022 and dismantled its autonomous trucking program in the summer of 2023.
Even though the CFIUS/Hydron investigation cleared Dr. Hou of wrongdoing, TuSimple’s Board terminated him without cause on October 30, 2022.21
Mr. Lu was reinstated as CEO on November 10, 2022, as TuSimple’s stock price continued to plummet from its high of $62.58 to less than $1.00 (before it eventually delisted in January 2024). 5.RR.243; CR.712. Days later, TuSimple lost its critical manufacturing partnership with Navistar. 5.RR.243–48. TuSimple then completed the first of many reductions-in-force, laying off hundreds of engineers responsible for its autonomous trucking technology in December 2022. 6.RR.124.
Efforts to find a new manufacturing partner were unsuccessful, as were efforts to sell the U.S. operations, resulting in several more rounds of layoffs
3. TuSimple’s internal “investigations” found no wrongdoing.
TuSimple completed two internal “investigations” after firing Dr. Hou. 5.RR.248–51; 6.RR.125–27. They found no wrongdoing and resulted in no disciplinary action. 5.RR.248–51; 6.RR.125–27.
The first, in late 2022, involved the personal computers of TuSimple engineers who (under an old policy, when no company computers were provided) had written TuSimple code on their personal computers. 7.RR.83–85; 5.RR.91. A new policy took effect in 2022 that required TuSimple work be done on TuSimple computers. 7.RR.83–85. To ensure compliance with the new policy, Mr. Lei Wang turned in his personal computer and asked
The second, in early 2023 after the first layoff, was initiated because a TuSimple employee reported to HR that Dr. Hou had allegedly told him, through Mr. Wang, “that I shouldn’t be working hard … because TuSimple is going to fail and I’m going to start a new company.” 5.RR.249. TuSimple hired Skadden to investigate, who interviewed a dozen employees before the investigation was “cut short” by Dr. Hou’s resignation from the TuSimple board. 5.RR.248–51. Other than one employee who inexplicably changed his story in a second interview, all confirmed that Dr. Hou did not solicit or pressure them in any way. See id. As with the laptop inquiry a few months prior, the employee inquiry resulted in no disciplinary action or terminations. See id.
After being ousted by TuSimple on October 30, 2022, Dr. Hou spent the weeks after his termination “cooking and buying domain names [including bot.auto] … and gaming.”24 ChatGPT was released to the public in November 2022, weeks after his termination. 5.RR.58. And with its release, Dr. Hou knew that AI had fundamentally changed and that he could utilize the new technology to achieve what remained his goal, commercializing autonomous trucking, with fewer resources and on a faster timetable.25
To that end, Dr. Hou decided to reenter the autonomous vehicle (“AV”) industry in the spring of 2023 and started operations that summer with 10–20 employees. 5.RR.59–61.
1. With emergent AI, Bot Auto starts fresh.
Dr. Hou founded his new company with technology that did not exist when he created TuSimple’s platform.26 Specifically, he leveraged the rapidly advancing “transformer” technology—the same technology behind
a. TuSimple’s convolutional neural network (CNN) had to manually train the AI model.
TuSimple’s system was based on a “convolutional neural network” (“CNN”) architecture. 8.RR.183; 5.RR.64–69 (“Because at that time, the new paradigm of neural network learning ha[d] not been invented.”). The concept of a CNN was introduced in 1989 and works by applying a mathematical equation called “convolution” to the pixels of an image, so that it learns to recognize patterns and relationships, eventually recognizing and predicting images. 8.RR.183–84.
TuSimple’s image-recognition CNN was effective but extraordinarily expensive and time-consuming. See 8.RR.183–84; 5.RR.64–69; 6.RR.52–53. The unannotated data had to first be collected from video footage taken by a mapping vehicle, and then each image had to be manually annotated one at a time by an army of human annotators—drawing a rectangle around a “person” or a “car” until the CNN learns to recognize a “person” or a “car.”28 See 5.RR.67.
b. Bot Auto’s pretrained transformer neural network (TNN) is able to “pretrain” the AI model.
The “transformer” architecture utilized by Bot Auto was made available to the public in late 2022,29 after TuSimple terminated Dr. Hou, and years after TuSimple created its CNN architecture.30 Instead of manually training
c. Bot Auto’s pretrained transformer neural network (TNN) no longer needs sensor fusion.
Bot Auto’s TNN is fundamentally different from TuSimple’s CNN because it eliminates the need for extensive manual training. It also eliminates the need for sensor fusion because it no longer needs multiple networks to process different kinds of data. 5.RR.76 (“the very infamous topic called sensor fusion does not even exist if you’re using a transformer-based neural network. You do not need to have that.”). In other words, to a [TuSimple] vehicle”), 187–88 (the “foundation of Bot Auto’s new technology” did not exist when he built TuSimple’s).
d. In addition to new AI, Bot Auto’s system and infrastructure is based on more efficient open-source technology that was not available when TuSimple’s system was created.
Further, Dr. Hou has also taken advantage of recent improvements in the AI ecosystem, specifically the open-source community. See 8.RR.187; 5.RR.83–85, 191. At TuSimple, Dr. Hou employed 100–200 employees for more than a year to build and maintain its software infrastructure platform in-house. 5.RR.83–85. At Bot Auto, he has embraced open-source products like Kubernetes and Infra as Code (“IaC”) to build Bot Auto’s platform with only eight employees in four months. Id. In other words, Bot Auto is utilizing
This fundamental change in the AI ecosystem and how Bot Auto is developing and housing its technology (i.e., open-source instead of in-house) is another reason TuSimple’s technology would be useless to Bot Auto. See 5.RR.83–85, 90, 191 (“Even if I got a direct hard copy of TuSimple’s source code in my hand, it’s useless to Bot Auto.”).
e. Bot Auto’s sensor technology takes advantage of new improvements in components.
Finally, Bot Auto also leverages new sensor technology that enables it to “see further” than TuSimple. 5.RR.106. For example, Bot Auto’s high-resolution LiDARs have over three times the resolution of TuSimple’s low-resolution LiDARs. Id.; 8.RR.187. Bot Auto’s more advanced sensors, data, and AI algorithms mean that data is collected and stored in completely different ways at the two companies. See 5.RR.106.
2. Dr. Hou leverages autonomous vehicle basics at Bot Auto.
CreateAI has alleged three buckets of “trade secrets,” defining them only at a high-level with general terms that encompass the core characteristics of any autonomous vehicle (“AV”) (e.g., sensors pointed forward). CR.7.
All AVs require certain fundamental components. 8.RR.179–80. Unsurprisingly, these include sensors, such as optical (cameras), LiDAR, and radar, which gather data about the vehicle’s surroundings, enabling it to detect obstacles, pedestrians, and other vehicles. Id. (“TuSimple Sensor Suite Technology”). Additionally, computer systems process this data in real-time, allowing the vehicle to make informed decisions and navigate complex,
a. A suite of sensors gives the truck perception.
One obvious requirement for any AV is that it be capable of “seeing” around the entire vehicle. Just as human drivers are instructed to turn their heads to check blind spots, AV sensors must be placed to ensure 360-degree coverage. The sensor arrangement will vary depending on two variables: (1) the individual sensor used (all have different fields of view and resolutions) and (2) the design of the vehicle on which they are attached. 8.RR.179. Bot Auto uses different sensors than TuSimple (as explained supra I.C.1.e.) and different vehicles (Daimler and Freightliner instead of Peterbilt and International Truck/Navistar). See 5.RR.100–01; 6.RR.123. So while Bot Auto uses a suite of sensors (as all AVs do), the selection and arrangement of those sensors differs in every way from TuSimple’s, as does the processing of the information. See 5.RR.100–01.
The sensor-suite design—choosing the technical specifications and installation location of each sensor—is the first step in developing a sensor algorithm. Id. It also determines the fail-safe policy (what redundancy to use when one sensor fails). Id. And as the above figures demonstrate, Bot Auto and TuSimple utilize different sensors and arrange them differently on different truck brands.35 Id.
In addition to a sensor-suite, all AVs have software called neural networks that process data from the different sensors, allowing it to make real-time decisions and avoid hazardous conditions the industry calls “edge” or “corner” cases. 8.RR.182. And, as explained above, Bot Auto’s TNN is fundamentally different from the CNN used at TuSimple. See supra I.C.1.
For example, “recognizing a person on a wheelchair,” or “interacting with tumble weeds” are classic examples of an “edge” or “corner” case in the AV industry. 8.RR.182. Because each company’s neural networks are different and every sensor has unique characteristics, the solutions are not one-size-fits-all. Id. Different AVs have varying abilities to solve any particular problem. Id. For example, one system might have difficulty detecting (and thus avoiding) a small animal on the side of the road because its sensors are arranged in a way that makes detecting low-to-the-ground objects more challenging. Id. As a result, the solution for that edge case will be different for each system. Id.
c. Redundancies make all trucks safer.
Finally, in addition to “sensing” obstacles and “deciding” how to avoid them, AVs require redundancies to ensure safety in the event of a component
But as with the sensor and decision-making technologies, the redundancies for every AV company are fundamentally different from each other. See 5.RR.112–13. For example, TuSimple and Bot Auto use different truck brands and different brands of steering and braking, so all the interfacing protocols and safety failure modes (i.e., redundancies) are different. See id. (Dr. Hou explaining both companies have redundancies but they use a completely different vocabulary and application to determine and solve component-failures, similar to the safety systems of a Camry versus an Accord—both have redundancies, but they are unrecognizable to each other).
3. Dr. Hou protected Bot Auto’s technology from contamination by any outside source—including TuSimple.
In building Bot Auto’s technology from the ground-up with the newest advancements in AI, Dr. Hou has made every effort to protect it from contamination or misappropriation by any outside source, including
First, in hiring engineers, Dr. Hou was careful not to solicit those who were currently working at TuSimple. 5.RR.80–83. But in the more than 1,000 employees who have left or been let go from TuSimple since December 2022, it is no surprise that some of them have landed at Bot Auto.40 Id. The 30–40 former TuSimple employees who now work at Bot Auto were not solicited by Dr. Hou but either (1) were fired and facing deportation when their short H-1B visa grace period expired; (2) voluntarily contacted Dr. Hou; or (3) left TuSimple, worked at a different company, and eventually came to Bot Auto. Id.
Second, Dr. Hou ensured that no employee brought trade secrets from a prior employer, including TuSimple, with them to Bot Auto. To that end, Bot Auto has its employees sign a “Mandatory Pre-Onboarding Questionnaire and Certification” and “Onboarding Questionnaire and Certification” “to ensure that no confidential or proprietary information is
And finally, even within Bot Auto, Dr. Hou has put in place security measures to protect the new technology from contamination by any outside source. 5.RR.87–91, 175, 179. For example, Bot Auto‘s system requires manual, internal inputs and doesn‘t allow additions from any outside source. 5.RR.173, 179, 90 (“if you just plug in a USB hard drive, it won‘t work“). Bot Auto‘s source code is constantly monitored and audited, built to trigger an alarm if anyone attempts to upload or download data in bulk. 5.RR.91, 175, 179, 181.
D. TuSimple‘s Failure: Liquidation Dispute, Pivot to Anime, and this Lawsuit.
By the summer of 2023, TuSimple‘s path to commercialization was no longer viable. See 6.RR.128–31. It had voluntarily delisted its shares, shut down all U.S. operations, and pivoted to its Asia-Pacific subsidiary, TuSimple China. Id.; see also 5.RR.244; 6.RR.116, 122, 131. Many shareholders (including Dr. Hou) wanted to liquidate the company and distribute what little value remained. See 8.RR.178–79. This led to more disputes and the largest shareholder, Mr. Chen, blocked dissolution. See id.; CR.541–42.
Between the summer of 2023 and summer of 2024, TuSimple began to quietly pivot to a new industry familiar to Mr. Chen from other investments (anime and videogames). See CR.541–42; see also 8.RR.178–79. During this
Mr. Lu hired an investigator in August 2024 who took pictures of Bot Auto‘s trucks and confirmed several innocuous facts: Bot Auto had operations in Houston and was operating a sensor-equipped vehicle on public roads. See 6.RR.122; 8.RR.170–72.
At the same time, TuSimple accelerated its pivot from autonomous trucking to anime and videogames. See SCR.32–37. Nonetheless, it filed this lawsuit (as TuSimple). And its rebrand, along with the name change to CreateAI, was not made public until weeks after the temporary injunction hearing, in December 2024. See SCR.21–27.
II. Procedural Background
A. CreateAI‘s Application for Temporary Injunction.
CreateAI filed this suit on October 1, 2024 (nearly two years after Dr. Hou‘s departure). CR.6–172. The initial hearing was held the next day, in which CreateAI‘s counsel previewed its now-shuttered AV business and the reparable nature of any potential injury as the company “at this stage of its life and its development, is largely in the business of licensing its technologies.” 2.RR.42. The trial court warned CreateAI that an injunction was “not going to issue on mere surmise”41 and noted that whether the
The parties agreed to a temporary restraining order that would preserve the status quo until an evidentiary hearing could be held and allow discovery by agreement,42 engaged in that discovery, and filed five rounds of briefing on the application, both before and after the temporary injunction hearing.43 Indeed, unlike most temporary injunction hearings that are held shortly after the application is filed with no discovery, CreateAI had the benefit of written discovery, Bot Auto‘s production of thousands of documents, and Dr. Hou‘s deposition.
B. Two-Day Temporary Injunction Hearing.
On November 18 and 19, 2024, the trial court held a two-day evidentiary hearing on CreateAI‘s application. 5.RR.4–289; 6.RR.4–176. The CEOs of both parties—Dr. Hou and Mr. Lu—testified at the hearing.44
Dr. Hou gave extensive testimony on his expertise in AI models, explaining the monumental, truly transformative changes the industry has undergone in the last two years that made it possible for him to independently develop Bot Auto‘s technology from the ground-up. See 5.RR.51–121, 77. Dr. Hou explained the fundamental differences between the two platforms (both of which he built), why they are incompatible with each other, and why any CreateAI “trade secrets” would be useless at Bot Auto. 5.RR.64–90, 187–88, 190–91.
Dr. Hou also explained how the recent advancements allowed him to build a platform that is more accurate than CreateAI‘s and can be developed on a shorter timetable with fewer resources—making commercialization possible. 5.RR.69–74. He also explained how CreateAI‘s “trade secrets” are defined so broadly that they merely describe the fundamental components of every AV. 5.RR.96 (explaining all AVs have sensors just as they all have wheels). Dr. Hou consistently testified throughout the hearing that Bot Auto has never used and would have no use for any CreateAI trade secrets.45
Mr. Lu was unable to refute Dr. Hou‘s testimony. He does not even have personal knowledge of or experience with the technology of either company.46 He joined CreateAI as the CFO months after Dr. Hou developed the technology at issue and has never typed a single line of CreateAI source code. 6.RR.82, 120. Mr. Lu was the only witness CreateAI offered at the hearing and he admitted to having “no evidence” of any document that was taken from CreateAI to Bot Auto. 6.RR.125. His testimony on CreateAI‘s technology was as high-level as you would expect from a finance executive and did not refute any of Dr. Hou‘s testimony on the fundamental incompatibility of the two companies’ different neural networks.47
Seeking to rebut Dr. Hou‘s testimony that no transformer technology was used on a CreateAI (TuSimple) truck, Mr. Lu tried to create confusion
Mr. Lu also acknowledged that CreateAI has “one of the largest organically developed patent portfolios in AV trucking” with more than 200 issued patents and 400 pending. 6.RR.107, 111. And he admitted that CreateAI made no effort whatsoever to determine what part, if any, of its alleged “trade secrets” are or are not subject to one of its hundreds of public patents. 6.RR.111–16.
On December 28, 2024, the trial court denied CreateAI‘s application for a temporary injunction by written order. CR.1091–92. It was not required to, nor did it, issue findings of fact or conclusions of law.
C. Bot Auto‘s Counterclaims.
Also in December, Bot Auto filed counterclaims against CreateAI, including bad faith assertion of trade secret misappropriation, business disparagement, and tortious interference. CR.1099–1150. CreateAI moved to dismiss the counterclaims under Rule 91a, and, conspicuously in contradiction of any imminent or irreparable injury, “request[ed] a stay of the action”50 to permit an interlocutory appeal if its motion were denied.51 SCR.587. On March 17, 2025, the trial court denied CreateAI‘s motion to dismiss and its corresponding request for a stay. SCR.592–93. Accordingly, CreateAI‘s TUTSA claim (now subject to a motion for summary judgment for failure to distinguish the alleged “trade secrets” from common practice and publicly disclosed information) and Bot Auto‘s counterclaims continue to proceed before the trial court. SCR.594–2176.
As CreateAI‘s authorities confirm, it had the burden to plead a cause of action under TUTSA and show a probable right to recover with evidence tending to sustain it and show a probable, imminent, and irreparable injury in the interim.52 This required it satisfy three distinct elements, with evidence, and it failed on all three. CreateAI did not state a TUTSA claim because it failed to identify any actionable trade secrets;53 did not prove a probable TUTSA claim because it failed to show Bot Auto is in a position to use any “trade secrets“;54 and failed to prove any probable threat of imminent, irreparable harm.55
Further to its own lack of evidence, CreateAI also failed to rebut Bot Auto‘s direct evidence—from the founder of both companies and creator of the technologies at issue—that the “trade secrets” are public and that, even if some portion were kept secret (of which there is no evidence), Bot Auto has no access to that unidentified “secret” portion and it would nonetheless have
In a case over the alleged misappropriation of autonomous trucking “trade secrets,” CreateAI offered only one witness, Mr. Lu, who was unable to describe the technology of either party. Mr. Lu has no personal knowledge of CreateAI‘s outdated technology (he joined after it was built and does not even have the ability to view the source code), and he has no personal knowledge of Bot Auto‘s cutting-edge technology. CreateAI could not, and did not, refute Dr. Hou‘s testimony that Bot Auto does not have, never has had, and would have no use for, the alleged “trade secrets” of CreateAI.
Mr. Lu‘s testimony focused—not on evidence of misappropriation—but on frustration with the “fresh start” Dr. Hou got at Bot Auto. See 5.RR.283–86. But that fresh start evidences Bot Auto‘s independently developed technology with the latest advancements in AI, not harm to or misappropriation of CreateAI‘s outdated “trade seсrets.”
When asked directly “Why has TuSimple brought this lawsuit?” Mr. Lu explained that CreateAI has spent “approximately $1.4 billion, to develop technology for self-driving. We‘ve accumulated one of the largest organic patent portfolios. We have assets, know-how, that – you know, source codes, tool chain, data that is valuable. And we want to monetize that value.”
This explains why CreateAI‘s arguments are based entirely on its own speculation.56 On speculation alone, CreateAI urges this Court to reverse the trial court‘s discretion. Instead, Texas law requires every party seeking an injunction to meet its extraordinary burden with evidence. And CreateAI failed to do so.
There is no evidence of trade secrets (to the contrary—the vague definitions offered by CreateAI include components that are physically visible to the public, subject to its own public patents, or fundamental to any autonomous vehicle). There is no evidence of threatened use (to the contrary—CreateAI‘s outdated technology is useless to Bot Auto). And there is no threat of irreparable harm (to the contrary—CreateAI is not competing with Bot Auto because it is not pursuing autonomous truck development, has pivoted to anime and videogames in China, and is now only trying to license its “trade secrets” to third parties).
CreateAI‘s insistence on a presumption underscores its lack of evidence to meet its burden. Citing IAC, Ltd. v. Bell Helicopter Textron, Inc., 160 S.W.3d 191 (Tex. App.—Fort Worth 2005, no pet.), CreateAI argues it
The trial court properly exercised its discretion in denying the injunction. Any other result would have been reversible error. The order should be affirmed because CreateAI did not carry its burden for the extraordinary relief it sought.
LEGAL STANDARD
“A temporary injunction is an extraordinary remedy and does not issue as a matter of right.” Abbott v. Anti-Defamation League Austin, Sw., & Texoma Regions, 610 S.W.3d 911, 916 (Tex. 2020) (per curiam) (quoting Walling v. Metcalfe, 863 S.W.2d 56, 57 (Tex. 1993)). The party applying for a temporary injunction bears the burden to “prove three specific elements: (1) a cause of action against the defendant; (2) a probable right to the relief sought; and (3) a probable, imminent, and irreparable injury in the interim.”
A trial court‘s order denying a temporary injunction is reviewed only for abuse of discretion. Hollins, 620 S.W.3d at 405. And in resolving evidentiary matters, “a trial court does not abuse its discretion ‘if some evidence reasonably supports the court‘s ruling.‘” Abbott, 610 S.W.3d at 916 (quoting Henry v. Cox, 520 S.W.3d 28, 34 (Tex. 2017)). Abuse-of-discretion review requires that the appellate court “view the evidence in the light most favorable to the trial court‘s order, indulging every reasonable inference in its favor,” and defer to the trial court‘s resolution of conflicting evidence. Amend v. Watson, 333 S.W.3d 625, 627 (Tex. App.—Dallas 2009, no pet.).
When, as here, there are no findings of fact or conclusions of law, the appellate court implies all necessary findings in support of the trial court‘s decision and upholds it on any legal theory supported by the record. EMSL Analytical, Inc. v. Younker, 154 S.W.3d 693, 696 (Tex. App.—Houston [14th Dist.] 2004, no pet.); Dallas Hous. Auth. v. Nelson, No. 05–13–00818–CV, 2015 WL 1261953, at *2 (Tex. App.—Dallas Mar. 19, 2015, pet. denied) (mem. op.) (citing Roberson v. Robinson, 768 S.W.2d 280, 281 (Tex. 1989)).
I. The Trial Court Properly Denied the Injunction.
A failure on any required element supports the trial court‘s discretionary denial; CreateAI failed across the board.
A. CreateAI failed to state a TUTSA claim.
CreateAI‘s claim is for misappropriation of trade secrets under TUTSA. CR.29–31;
The elements of a TUTSA claim are:
- (1) the existence of a trade secret;
- (2) acquisition of the trade secret through a confidential relationship or discovery of it by improper means;
- (3) use of the trade secret without authorization; and
- (4) resulting damages to the plaintiff.
Palliative Plus LLC v. A Assure Hospice, Inc., No. 03-23-00770-CV, 2025 WL 284920, at *11 (Tex. App.—Austin Jan. 24, 2025, no pet. h.) (Field, J.) (citing Neurodiagnostic Consultants, LLC v. Nallia, No. 03-18-00609-CV, 2019 WL 4231232, at *8 (Tex. App.—Austin Sept. 6, 2019, no pet.) (mem.
1. CreateAI failed to identify any information entitled to trade secret protection.
Under TUTSA, information qualifies as a “trade secret” only if it meets two requirements:
(A) [T]he owner of the trade secret has taken reasonable measures under the circumstances to keep the information secret; and
(B) the information derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable through proper means by, another person who can obtain economic value from the disclosure or use of the information.
While an applicant is not required to prove the alleged trade secrets are in fact trade secrets until trial, it still bears the burden at the temporary injunction stage to identify information that more likely than not satisfies TUTSA—i.e., merits trade secret protection pending a trial on the merits.
The first step of doing so requires a plaintiff to identify with reasonable particularity the metes and bounds of information that allegedly warrants trade secret protection. St. Jude Med. S.C., Inc. v. Janssen-Counotte, No. A-14-CA-877-SS, 2014 WL 7237411, at *15 (W.D. Tex. Dec. 17, 2014). CreateAI
a. The alleged “trade secrets” are not adequately defined.
CreateAI‘s claim must start with adequately defining its alleged “trade secrets“; its failure to do so is dispositive.59 Indeed, the trial court keyed in on this issue at the initial hearing. 2.RR.59 (noting that whether the application described true trade secrets would be “something that is worthy of discussion.“). But weeks later, after written discovery, depositions, and a two-day evidentiary hearing, CreateAI still had not adequately defined its “trade secrets.”
Adequately defining the “trade secrets” at issue is an essential first step of both stating a TUTSA claim and seeking an injunction because an injunction must specifically describe the alleged trade secrets and give
Courts frequently refuse to issue or overturn injunctions when the plaintiff fails to adequately define the trade secrets at issue, as CreateAI has failed to do here. See Retail Services WIS Corp. v. Crossmark, Inc., No. 05-20-00937-CV, 2021 WL 1747033, at *14 (Tex. App.—Dallas May 4, 2021, pet. denied) (mem. op.) (reversing portions of an injunction when the trade secret definition was “too vague“); see also Ramirez, 2013 WL 4568365, at *4 (vacating portions that did “not define ‘Proprietary Information/Trade Secrets’ with enough specificity to give appellants adequate notice of the acts they are restrained from doing.“).
The broad, abstract definitions offered by CreateAI of its alleged trade secrets—“Sensor Suite Technology,” “Autonomous Decision-Making Technology,” and “Automatic Safety Technology“—generically encompass the macro components of every AV on the road today (i.e., ubiquitous, general knowledge in the AV industry).60 GE Betz Inc. v. Moffitt-Johnson, 301 F. Supp. 3d 668, 691 (S.D. Tex. 2014) (“[M]atters of general knowledge
CreateAI‘s generic, high-level, kitchen-sink approach to defining the alleged “trade secrets” falls far short of its burden to describe the precise information at issue with reasonable particularity. See StoneEagle Servs., Inc. v. Valentine, No. 3:12-CV-1687-P, 2013 WL 9554563, *2–*5 (N.D. Tex. June 5, 2013) (recognizing that Texas law requires plaintiffs “to identify, with reasonable particularity, the alleged trade secrets at issue” and explaining “a list that separately breaks out each of the individual alleged trade secrets and identifies each claim so that the reader understands how each claim differs from public domain filings” complies, but generalized disclosures that only
CreateAI‘s vaguely-defined and highly-abstracted “trade secrets” make its true aim clear: stunt Bot Auto‘s success by broadly enjoining the “know-how” they complained of at the temporary injunction hearing—i.e., general knowledge and experience that TUTSA makes clear cannot be enjoined.62 Ramsey v. Sheet Pile, LLC, No. A-21-CV-00331-LY, 2022 WL 4000714, at *5 (W.D. Tex. Sept. 1, 2022) (“Texas law restricts injunctions from ‘prohibit[ing] a person from using general knowledge, skill, and experience that person acquired during employment.‘“) (quoting
In addition to lacking specificity, the “trade secrets” claimed by CreateAI also lack the essential element of secrecy—another dispositive failure. Tewari De-Ox Sys., Inc. v. Mountain States/Rosen, L.L.C., 637 F.3d 604, 611 (5th Cir. 2011) (“It is self-evident that the subject matter of a trade secret must be secret.”) (quoting Luccous v. J. C. Kinley Co., 376 S.W.2d 336, 338 (Tex. 1964)). “[I]nformation generally known and readily available is not protectable, and no trade secret protection is available when the material or procedure at issue has been publicly disclosed.” Sw. Rsch. Inst. v. Keraplast Techs., Ltd., 103 S.W.3d 478, 482 (Tex. App.—San Antonio, 2003, no pet.)).
The word ‘secret’ implies that the information is not generally known or readily available. Courts have refused to give trade secret protection when the material or procedure sought to be protected has been publicly disclosed.
T-N-T, 965 S.W.2d. 18, 22 (Tex. App.—Houston [1st Dist.] 1998) (citations omitted).
CreateAI bore the burden to adequately define its alleged “trade secrets” in a manner sufficient to distinguish the alleged “trade secrets” from common practice and publicly disclosed information, such as the disclosures in CreateAI’s extensive patent portfolio. E.g., Topstone, 729 F. Supp. 3d at 706–07; see 6.RR.107, 111–16.
Others CreateAI chose to make publicly available in its 200+ patents or 400+ patent applications—what CreateAI described as “one of the largest organic patent portfolios [in AV trucking].” 5.RR.288; 6.RR.111. The breadth of CreateAI’s patent portfolio around AV technology demonstrates the conscious choice by CreateAI to forego trade secret protection in favor of patent protection. 6.RR.108–14; 7.RR.224; FMC Techs., Inc. v. Murphy, 679 S.W.3d 788, 807, 813 (Tex. App.—Houston [1st Dist.] 2023, pet. denied) (information is readily ascertainable and not a trade secret if it is published, including in patents or patent applications).
CreateAI admitted at the temporary injunction hearing what is already evident from its public patent portfolio—that many of its patents relate to AV sensor-suites, safety, and decision-making—i.e., its three alleged “trade secrets.” See 5.RR.200–01; see also 6.RR.111–14 (Mr. Lu admitting that
Further, as Mr. Lu acknowledged and just another example, CreateAI publicly disclosed the locations of its cameras, LiDAR, and radar devices and the use of a dual CAN-bus architecture in its 2022 Investor Day Presentation. 6.RR.86; 8.RR.124. And many of the sensors in CreateAI’s sensor-suite were bought off-the-shelf, meaning they are freely available for use by other industry participants. See 6.RR.98–99.
Mr. Lu also testified that, despite the admitted overlap, CreateAI has made no effort whatsoever to determine what, if any, of its AV technology is a trade secret not covered by one of its hundreds of patents. 6.RR.115–16. That admission alone is sufficient to justify the trial court’s denial of CreateAI’s requested injunction because it proves that CreateAI’s inadequately defined “trade secrets” have been publicly disclosed and cannot, as a matter of law, be protected as trade secrets under TUTSA.
CreateAI’s alleged “trade secrets” are in no way secret. Most (if not all, it is impossible to know without an adequate definition) have been disclosed, by CreateAI, to the public at large and those disclosures eliminate its TUTSA claim—more than justifying the trial court’s order on that basis alone. Even if there were a sliver of CreateAI’s “trade secrets” that were maintained as
B. CreateAI failed to demonstrate a probable right to recover on its TUTSA claim.
In addition to failing to state a TUTSA claim by failing to adequately define its alleged “trade secrets”—its attempt is too vague and general and its alleged “trade secrets” are not secret at all—CreateAI also failed to show it probably would recover on that claim had it properly stated it.
1. CreateAI failed to prove any alleged trade secret was acquired through improper means.
First, it is impossible to acquire public information through improper means. Second, even assuming they were not public, CreateAI nonetheless offered no evidence that Bot Auto acquired any of its “trade secrets” through improper means. To the contrary, it conducted two “investigations” that in an ordinary trade secret case would be expected to result in concrete evidence but in this case resulted in … nothing.
Indeed, not only was the individual at issue in the laptop investigation, Mr. Wang, neither terminated nor disciplined, he was given accelerated shares as a retention bonus following the investigation. 6.RR.125–27. And Mr. Wang’s computer was imaged in full—CreateAI has access to every download, upload, and use of the computer they claim was put up as a “smokescreen,” and yet, CreateAI did not submit any of that into evidence or
Similarly, the solicitation “investigation” resulted in no evidence of any wrongdoing by Bot Auto. Instead, the testimony by Dr. Hou evidenced the opposite: None of Bot Auto’s employees were recruited directly from CreateAI and all were required to sign questionnaires and certifications before joining “to ensure that no confidential or proprietary information is used at Bot Auto.” 7.RR.68–76; 5.RR.88–89. The evidence shows nothing improper about Dr. Hou’s (or any other former employee’s) departure. Bot Auto has put in place policies and procedures to ensure that no trade secrets migrated from CreateAI to Bot Auto, intentionally or unintentionally. 7.RR.68–76; 5.RR.88–89, 91, 175, 179, 181.
After failing to adequately identify and present evidence of actionable trade secrets, it failed to show an improper acquisition of “trade secrets”; the trial court’s denial of the injunction can be affirmed on this basis too.
2. CreateAI failed to prove any use or threatened use of an alleged trade secret.
Even if CreateAI had provided evidence of trade secrets and their improper acquisition (which it did not and cannot), denial still was proper because CreateAI offered no evidence of the third prong—use or threatened use of the alleged trade secrets. CAE Integrated, L.L.C. v. Moov Techs., Inc., 44 F.4th 257, 263 (5th Cir. 2022) (affirming denial of an injunction because an inference of misappropriation based on defendant’s success “is insufficient to support a finding that [the defendant] used [the applicant’s] trade secrets.”).
a. CreateAI’s support—two pre-TUTSA cases—examined evidence of actual trade secret possession by a competitor not present here.
CreateAI relies principally on two cases. CreateAI’s Br. at 34–38 (citing IAC, Ltd. v. Bell Helicopter Textron, Inc., 160 S.W.3d 191 (Tex. App.—Fort Worth 2005, no pet.); T-N-T Motorsports v. Hennessey Motorsports, 965 S.W.2d 18 (Tex. App.—Houston [1st Dist.] 1998)). Both of these cases predate TUTSA’s 2013 enactment, reviewed the issuance (not denial) of a temporary injunction, and, most important, examined direct evidence of (1) actual possession (2) of actual trade secrets (3) by a competitor positioned to use them—none of which arе present here. See Bell Helicopter, 160 S.W.3d. at 200 (“When a defendant possesses trade secrets and is in a position to use them, harm to the trade secret owner may be presumed.”) (emphasis added).
In CreateAI’s first case, Bell Helicopter, a defendant (a repair contractor) gained access to Bell’s proprietary information through a confidentiality agreement as it contracted to repair rotor blades for Bell’s 206B helicopter. Bell Helicopter, 160 S.W.3d at 196–97. The defendant in Bell Helicopter then worked with a Bell-competitor (a codefendant) to design an identical replacement rotor blade for the 206B helicopter, offering it at a lower price than Bell’s 206B. Id. at 196–200.
In contrast to here, Bell presented actual evidence the defendant possessed and was using the trade secrets at issue—the defendant had the proprietary blade data in its library and the Bell-competitor had access to
The second case also looks nothing like the present and does not permit the entire-case presumption CreateAI seeks. In T-N-T, Roy Terpstra ran a part-time body shop (“T-N-T”), designing and manufacturing products for Hennessey Motorsports (“Hennessey”) as the “director of Viper operations” that Hennessey used in the high-performance upgrade packages it sold for Dodge Vipers (called “Venom upgrades”). T-N-T, 965 S.W.2d at 20, 24.
In 1997, Roy Terpstra quit his job at Hennessy and ten days later he “attended a Viper Club meeting in Florida at which he distributed T-N-T business cards and [] brochures advertising the availability of high grade performance upgrades for Vipers[, claiming] that the T-N-T upgrades were identical to the Venom upgrades, that he had learned how to create these packages as an employee of [Hennessey], and that he offered the same upgrades as [Hennessey] but at a better price[, that] at least three of [Hennessey’s] customers had already moved their business to T-N-T [and Hennessey] was his only competitor.”
Id. at 20–21.
So while some Texas cases presume harm when there are actual, properly identified and proven trade secrets possessed by a defendant that is in a position to use them, CreateAI failed to get that far. As explained above, CreateAI failed to specifically identify trade secrets, failed to identify them in a wаy that distinguishes them from common practice and publicly disclosed information, offered “trade secrets” that are too general, demonstratively public, and not secret (such as the disclosures in CreateAI’s extensive patent portfolio), and failed to show how it was likely to recover on the TUTSA claim it failed to properly state.65
Turning to the three specific categories of “trade secrets” CreateAI alleges here, Dr. Hou explained that, under CreateAI’s broad definition, they all exist in every AV because every AV company has the “same goal” of
b. Bot Auto is not using, and is not in a position to use, CreateAI’s sensor-suite technology.
First, as to CreateAI’s “sensor-suite,” the only similarity with Bot Auto’s is that they both use sensors, which is likе saying they both have headlights.68 Otherwise, disparities abound—rebutting any threat of potential use by Bot Auto of CreateAI’s visible, public “sensor-suite” technology. See 5.RR.96, 99–108, 123.
From the start, the selection of sensors is different at Bot Auto—in fact, there is “no similarity.” 5.RR.96, 99–108, 106 (Bot Auto takes advantage of high-definition LiDARs that were not available when CreateAI’s sensor-suite was designed). The arrangement of sensors, as Mr. Lu testified,69 is different
c. Bot Auto is not using, and is not in a position to use, CreateAI’s decision-making technology.
The fundamental difference between Bot Auto’s technology (that harnesses the latest developments in AI—i.e., transformers) and CreateAI’s antiquated technology (developed before transformers were available)—is seen in the “decision-making” technology that CreateAI claims is a trade secret. The parties’ fundamentally incompatible systems belie any speculation of use by Bot Auto, as did the direct, unrebutted evidence. All AI models make decisions (again, this “trade secret” is a uniform characteristic
CreateAI offered no evidence of “use” other than its own speculation that Bot Auto’s timeline for commercializatiоn could only be explained by using its alleged trade secrets. CreateAI’s Br. at 24 (citing to its own application). But a defendant’s success does not support an inference of trade secret misappropriation. See CAE Integrated, 44 F.4th at 263.
And Dr. Hou testified extensively to the way Bot Auto’s technology was built from the ground-up, without any reliance on CreateAI’s antiquated platform, and how that blank slate enabled it to achieve a shorter, and less expensive, path to commercialization. 5.RR.78–79 (Dr. Hou explaining the benefit of starting Bot Auto’s technology from scratch because he could fully embrace the newest technology without having to incur the expenses and delays of pivoting—he did not have to pay any “managerial debts” or remove any “lattices”).
Finally, to the extent any testimony on the technology conflicts, accreditation of Dr. Hou’s, as the creator of both systems, over Mr. Lu’s (who has no personal experience with or knowledge of Bot Auto’s system and who
d. Bot Auto is not using, and is not in a position to use, CreateAI’s safety technology.
Similar to the sensor and decision-making technologies, the “safety” technology CreateAI claims is a trade secret really is a “central dogma or central pursuit” of every AV company. 5.RR.111. The safety features—i.e., redundancies, are a “general concept” that “every component-level failure should not lead to the failure of the whole system.” 5.RR.111–12 (like two engines in an airplane). As with the other “trade secrets,” Bot Auto’s pursuit of this goal is fundamentally different in application from CreateAI’s because
Bot Auto demonstrated that it is neither using nor in a position to use any of CreateAI’s alleged “trade secrets,” and CreateAI offered no evidence to the contrary.
C. CreateAI failed to show a probable, imminent, irreparable injury.
CreateAI also failed to show that it faces a probable, imminent, irreparable injury.
While some cases have held that a probable TUTSA claim demonstrates potential harm as a matter of law, they are inapplicable here because CreateAI failed to produce evidence on any element of its trade secret claim. See supra Arg. I.A, Arg. I.B.; see Bell Helicopter, 160 S.W.3d at 200 (requiring actual trade secrets and a position to use them before
A party seeking injunctive relief must demonstrate irreparable injury—which cannot be established with mere fear or speculation.73 N. Cypress Med. Ctr. Operating Co., Ltd. v. St. Laurent, 296 S.W.3d 171, 175 (Tex. App.—Houston [14th Dist.] 2009, no pet.).
1. Injury is not probable; CreateAI’s TUTSA claim fails foundationally for lack of trade secrets.
First, for all the reasons CreateAI’s TUTSA claim is not adequately stated or likely to succeed, any threatened injury from the improbable claim is also highly unlikely and purely speculative. Legacy Home Health Agency, Inc. v. Apex Primary Care, Inc., No. 13-13-00087-CV, 2013 WL 5305238, at *2 (Tex. App.—Corpus Christi-Edinburg 2013, pet. denied) (reversing a trade secret injunction where the applicant had only a “mere fear or apprehension of the possibility of injury”) (citing Frey v. DeCordova Bend Estates Owners Ass’n, 647 S.W.2d 246, 248 (Tex. 1983)).
2. Injury is not imminent (TuSimple is now CreateAI).
Second, in addition to lacking any foundation, CreateAI’s speculative fear of injury lacks any imminence. CreateAI and Bot Auto are not competitors—a key factor for determining the irreparable nature of any potential harm. Bianco v. Globus Med., Inc., No. 2:12-CV-00147-WCB, 2014 WL 1049067, at *5–6 (E.D. Tex. Mar. 17, 2014) (surveying trade secret cases and noting that “the plaintiff’s status as a competitor or noncompetitor of the
Further, CreateAI’s own conduct (its industry pivot and delay in bringing and prosecuting this case) shows that it faces no imminent harm. It pivoted from AV manufacturing (as “TuSimple”) to anime and videogames (as “CreateAI”) and faces no harm (much less imminent harm) from Bot Auto succeeding with its new, home-grown technology in CreateAI’s former industry while this case proceeds to trial. See 6.RR.76–77.
CreateAI also waited several months to bring this lawsuit in October 2024 even though it was aware for more than a year prior that its ousted CEO was founding another AV trucking company. 5.RR.253; 8.RR.179; Shenzhen Chengront Tech. Co., Ltd. v. Besign Direct, No. 1:22-CV-10281-JLR, 2022 WL 17741496, at *1 (S.D.N.Y. Dec. 9, 2022) (“several months’ delay in seeking injunctive relief indicates Plaintiff will not be irreparably harmed by
And after delaying in bringing the case, CreateAI has also delayed its prosecution of it, even seeking a stay—acting with no urgency to remedy the “imminent” harm it allegedly faces.74 CreateAI’s own industry-pivot and litigation delays show that it faces no imminent harm.
3. Injury is not irreparable (CreateAI is trying to license—monetize—its alleged trade secrets).
Finally, any injury CreateAI claims to face is compensable with money damages (as its own efforts to license, and monetize, the purportedly misappropriated technology demonstrates). 2.RR.42; 6.RR.77 (“We’re attempting to license.”). A party suffers irreparable injury only if it cannot be “adequately compensated in damages or the damages cannot be measured by any certain pecuniary standard.” Mabrey v. SandStream, Inc., 124 S.W.3d 302, 317 (Tex. App.—Fort Worth 2003, no pet.). And a party willing to license its technology is self-evidently willing to accept money in place of exclusivity. See Nichia Corp. v. Everlight Elecs. Co., No. 02:13-CV-702-JRG, 2016 WL 310142, at *66 (E.D. Tex. Jan. 25, 2016), aff’d sub nom., Nichia Corp. v. Everlight Americas, Inc., 855 F.3d 1328 (Fed. Cir. 2017) (“[Plaintiff’s] licensing of the patents-in-suit to the suppliers of 41% of the global LED market also precludes a finding of irreparable harm.”). Any impact on CreateAI’s so-far-failed efforts to monetize its outdated technology is repairable by money damages. See id.
D. CreateAI failed to carry its trial and appellate burdens.
Before the trial court, CreateAI bore the burden to state a TUTSA claim, prove it was probable, and that it faced a probable threat of imminent, irreparable harm. Hollins, 620 S.W.3d at 405; Butnaru, 84 S.W.3d at 204. CreateAI failed on all counts and the injunction was propеrly denied.
On appeal, CreateAI bears an even higher burden of demonstrating that the trial court’s decision (which must be given every reasonable inference in favor of sustaining it without specific findings and conclusions) was “so arbitrary that it exceeded the bounds of reasonable discretion.” Midway CC Venture I, LP v. O&V Venture, LLC, 527 S.W.3d 531, 533 (Tex. App.—Houston [1st Dist.] 2017, no pet.); Younker, 154 S.W.3d at 696. CreateAI has not and cannot meet this high burden for the extraordinary relief it seeks—the unrebutted evidence supports the trial court’s denial of the injunction, and the order should be affirmed.
PRAYER
Appellee Bot Auto prays the trial court’s order denying CreateAI’s application for a temporary injunction be affirmed in all respects and that it be awarded such other and further relief to which it may be entitled.
Respectfully submitted,
By: /s/ Joseph A. Fischer, III
Joseph A. Fischer, III, lead counsel
tfischer@jw.com
Texas Bar No. 00789292
Leisa Talbert Peschel
lpeschel@jw.com
Texas Bar No. 24060414
Victoria C. Emery
temery@jw.com
Texas Bar No. 24126228
JACKSON WALKER LLP
1401 McKinney, Suite 1900
Houston, TX 77010
Telephone: (713) 752-4530
Facsimile: (713) 308-4130
– and –
Allison Allman
aallman@jw.com
Texas Bar No. 24094023
777 Main Street, Suite 2100
JACKSON WALKER LLP
Fort Worth, TX 76102
Telephone: (817) 334-7200
Facsimile: (817) 334-7290
COUNSEL FOR APPELLEE
BOT AUTO TX INC.
Relying on the word count function of the computer software used to prepare this document, the undersigned certifies that the Brief of Appellee contains 14,867 words (excluding the sections excepted under
/s/ Allison Allman
Allison Allman
CERTIFICATE OF SERVICE
I hereby certify that on April 23, 2025, a true and correct copy of the foregoing document was served by electronic service on all counsel of record in accordance with the Texas Rules of Appellate Procedure.
/s/ Allison Allman
Allison Allman