$280 Million Robot Dustup
Roomba maker accuses military contract winner of stealing trade secrets
PHOTO: Robotic FX [left] iRobot Corp. [right]
LOOKING FOR AN ARMY CONTRACT
Similarities between iRobot’s PackBot [right] and its rival the Negotiator, from Robotic FX [opposite], led iRobot to file two lawsuits against Robotic FX.
Some robotic face-offs take place in gladiatorial arenas, others on ping-pong-table-size soccer fields. Those fought in courtrooms can be just as much fun to watch, because sometimes they come complete with dumpster-diving private investigators, accusations of planted evidence, erased computer disks, shredded data CDs, and trade secrets discussed in closed hearings.
That is the case in a recent dispute between iRobot, in Burlington, Mass., known for its Roomba vacuum cleaner, and a smaller rival, Alsip, Ill.based Robotic FX. iRobot has filed two lawsuits against Robotic FX and its founder and president, Jameel Ahed, a former iRobot employee, alleging patent infringement and theft of trade secrets. The suits concern iRobot’s PackBot, a bomb-disposal robot widely used in Iraq and Afghanistan. iRobot accuses Robotic FX of using proprietary PackBot technology to create a competing robot called the Negotiator. Robotic FX denies the accusations and says that the lawsuits are an attempt to shut down a competitor that iRobot now sees as a threat.
In August, the two companies competed in a U.S. Army program called xBot, whose goal is to procure a smaller, lighter type of bomb-detection robot than those currently used in Iraq. The Army plans to deploy up to 3000 of the new robots in the next five years as part of efforts to counter improvised explosive devices (IEDs), which are responsible for nearly half of all coalition troop casualties in Iraq.
Analysts regarded iRobot, a 375â''employee publicly traded company with revenues of US $189 million last year, as the favored bidder. But privately held Robotic FX, which reportedly has eight employees, won the contract, valued at $279.9 million. The news knocked iRobot’s stock down nearly 30 percent in the following days.
Last month iRobot was granted a preliminary injunction prohibiting Robotic FX from selling the Negotiator in its current design. The Army, which initially opposed iRobot’s request for an injunction, arguing that it could delay the delivery of robots to the troops, later decided to freeze the contract and reevaluate Robotic FX’s ability to carry out the contract.
The stakes are high for both sides. Ahed revealed during the court hearings that an unnamed major defense company is interested in acquiring Robotic FX, a deal that could reward its founder handsomely. For iRobot, the possibility of its allegedly stolen designs falling into the hands of a large, deep-pocketed competitor is a worrisome development.
The Army created the xBot program to address a pressing need of U.S. troops in Iraq. The robots currently used by specialized bomb-disposal squads are too big and too heavy for regular soldiers on patrol and convoy missions to take with them. A smaller, lighter robot would allow troops to inspect suspicious objects before calling the bomb squad.
To procure the robots, the Army prepared a set of requirements and organized a two-stage competition: a technical test, to see which robots met the requirements, and a reverse auction, in which the participant making the lowest bid would get the contract.
The technical test took place at the Redstone Arsenal in Huntsville, Ala., in August. The robots—required to weigh no more than 22.6 kilograms and feature a manipulator arm, among other things—had to traverse sand, gravel, and water pits, maneuver their arms to lift objects, and position their cameras, in scenarios that simulated IED investigations.
iRobot brought two robots: a lighter version of PackBot and a new 14â''kg robot called the Small Unmanned Ground Vehicle, developed under the Army’s Future Combat Systems program. Robotic FX brought its Negotiator. All three robots passed the test.
The reverse auction occurred the following month. The starting bid was $305 million, and the companies kept lowering their bids until iRobot gave up. Robotic FX won the contract with a bid of $279.9 million (iRobot’s final bid was $286 million).
iRobot, not surprisingly, disapproved of the procurement process. A reverse auction is normally used to buy commoditized products such as spare parts—not advanced systems like robots, says Joseph Dyer, president of iRobot’s government and industrial division.
The procurement was also unusual for its brevity and detailed requirements, according to several robotics executives interviewed by IEEE Spectrum on condition of anonymity. It appeared, these sources say, that the Army knew exactly which robots it wanted. ”It wasn’t normal; it was very quick,” says a senior executive familiar with the xBot program whose company has contracts with the military.
A spokeswoman for the Program Executive Office for Simulation, TRaining, and Instrumentation (PEO STRI), the Army organization in charge of the xBot contract, says its procurement process ”was the best way to satisfy the urgent requirement for robots.” PEO STRI officers, based on a ”preaward survey,” had determined that Robotic FX was capable of fulfilling the 3000-robot contract, but late in October they decided to put the award aside and conduct another assessment.
The PackBot and the Negotiator may have similar capabilities, but they came about under different circumstances. The PackBot was originally developed under a multimillion-dollar program of the Defense Advanced Research Projects Agency (DARPA). It carries a Pentium-powered onboard computer running Linux and custom control software. A fully equipped PackBot can cost more than $100 000.
In contrast, the Negotiator was designed around a basic 8â''bit microcontroller, Robotic FX’s Ahed told Spectrum. It has a modular plug-and-play architecture that accommodates various accessories and sensors. That approach resulted in what Ahed calls ”a simple, low-cost system.” Robotic FX will not disclose the price of the Negotiator, but in 2005 the Illinois State Police bought six units for a total of $122 940. The company says it has sold 80 Negotiators to federal, state, and local agencies in the United States since 2004.
iRobot’s patent-infringement suit, filed in the U.S. District Court in Birmingham, Ala., focuses not on the robot’s brains but on its mobility capabilities. iRobot claims Robotic FX violated its patents No. 6,263,989 and No. 6,431,296, which describe how the PackBot uses a pair of main tracks to move around (like a miniature tank) and a pair of auxiliary tracks, mounted on the sides, to go over obstacles and climb stairs, a capability that made the robot stand out among competitors. The Negotiator has auxiliary tracks similar to those on the PackBot.
In a separate lawsuit over pilfered trade secrets, filed in the U.S. District Court in Boston, iRobot accuses Ahed of stealing proprietary PackBot data and violating the confidentiality agreement he signed while an employee at the company.
Ahed began working at iRobot just after getting his bachelor’s degree in biomedical engineering from the University of Illinois, Urbana-Champaign, but resigned two years later, in 2002, to found Robotic FX. iRobot claims that Ahed, who worked on PackBot-related projects, used confidential data to design the Negotiator.
Early this year, iRobot became aware of the Negotiator and obtained a unit to study. Concluding it was a ”knockoff version” of the PackBot, iRobot sent a warning letter to Robotic FX and communicated its concerns to the Army PEO STRI officers overseeing the xBot contract. It filed the two lawsuits in August.
According to court records, iRobot hired private investigators to follow Ahed. The day after the lawsuits were filed, iRobot says its investigators saw Ahed load objects into a car and later put them in a dumpster. The investigators retrieved the objects, which included a box marked ”iRobot,” a robot’s wheels and treads, and a welding tool and aluminum molding fixture that iRobot claims are used to make the PackBot tracks.
Ahed said in the hearings that the material dumped was just iRobot ”memorabilia” he didn’t want to keep anymore and that the aluminum fixture wasn’t his, suggesting it had been planted. He acknowledged shredding about 100 data CDs and erasing a laptop’s hard drive, but he said they contained only Robotic FX design and financial data and that he was ”afraid that someone would come in and steal my work.”
In the injunction order against Robotic FX, Judge Nancy Gertner says Ahed’s actions undermine his credibility.
At press time, the trade secrets trial was scheduled to begin by 7 April 2008. If similar high-tech legal battles are any indication, the iRobot v. Robotic FX cases will be long and complicated—not to mention hugely expensive for the parties, making settlement out of court likely.
An unlikely but more exciting resolution: the companies could place their robots in a battle arena and let them settle the dispute.