Tesla Sues Former Supplier Matthews for Alleged EV Battery Trade Secret Theft

Tesla has sued its former supplier Matthews International in California federal court for allegedly stealing trade secrets related to Tesla's battery-manufacturing process and sharing them with the electric-vehicle giant's competitors. The lawsuit, filed on Friday in U.S. District Court for the Northern District of California, said Matthews owes damages that Tesla "conservatively estimates will exceed $1 billion" for misusing company trade secrets related to dry electrode battery manufacturing technology.

Spokespeople for Matthews and attorneys and spokespeople for Tesla did not immediately respond to requests for comment on Monday.

Pittsburgh-based Matthews began supplying Tesla with manufacturing machinery in 2019, according to the complaint. Tesla said it shared secrets with Matthews related to dry-electrode coating, which the carmaker has said can dramatically reduce the size, cost, energy consumption and production cycle time of battery manufacturing plants while boosting the energy density and power of battery cells.

The lawsuit said Matthews shared Tesla's innovations with unnamed competitors by selling "machines and other technologies embodying Tesla's trade secrets." It also said Matthews claimed Tesla's inventions as its own in patent filings that have revealed confidential Tesla information.

Tesla asked the court to block Matthews from misusing its trade secrets and hand over its patent applications in addition to requesting monetary damages.