In October 2011, I applied to Startup Chile, an incubator of the Chilean government, with GoyaTelemarketing, a sales software prototype. YouNoodle handled the online applications. There was a non-disclosure agreement. The software and pitch videos, and my website, were all password-protected. To help filter startup applications, YouNoodle also hired Silicon Valley insiders who accessed my website at the end of November, but no one in Chile ever saw it. I wasn’t selected and moved to Europe.
On 11/29/2012, I discovered Close.io, a YCombinator startup launching a sales software with essentially the same functionalities, though the layout and color palette are different. I think the IP was lifted from my Startup Chile application. For two years, I procrastinated and continued coding my software. At the end of 2014, I discovered the USC 1832 statute of trade secret theft and summarized my claim on a private blog post with the intent of a civil resolution. In January 2015, I discussed the issue with a Silicon Valley IP lawyer who reviewed the blog post and referred me to a top-tier California IP litigator but filing an IP lawsuit costs 300K.
Unable to afford a civil litigation, I decided in summer 2015 that I would blow the whistle and ask for a cease and desist without financial compensation. In October 2015, I finished a 30-page password-protected blog post and a video pitch. I called about 200 lawyers, spoke briefly with about 50, and discussed my strategy with about a dozen: no contingency representation. Some warned that a public disclosure could lead to a lawsuit and suggested to start with a demand letter. On 10/29/2015 and 10/31/2015, I sent the Close.io stakeholders an email with access to the blog post to see if they wanted to propose a settlement option; no reply.
In January 2016 I realized it’s potentially illegal to claim a criminal statute when seeking a civil resolution. The lawyers I spoke with knew it but kept quiet. I think it’d be able to show I had no mens rea, acted in prudent good faith, but might have made a mistake of law. On 7/19/2016, at a startup competition in Stuttgart, the startup judges concluded that my software was the same as Close.io: that’s the extent of the similarity. I decided to find a lawyer for a criminal complaint but without significant financial resources, there’s nothing, despite 510 pages of emails with US lawyers. I filed my first criminal complaint on 4/27/2017 and my last action on 2/22/2018 was to ask for a US Senate investigation.
My trade secret is seemingly simple: a CRM that works as a communication tool. In the same online interface, users make calls and send emails while the software logs everything, without manual data-entry, and has a lead search engine for sales follow-up. My notarized Startup Chile application is available online to compare with Close.io’s narrative.
3 reasons I think there was a trade secret theft. A) Functional similarity: which functionalities are in GoyaTelemarketing and not in Close.io? youtu.be/YXgK8OBQA0c vs youtu.be/55sAnbe6lXE B) The founders pivoted a few days after the review of my application. A former US prosecutor asked me “Could be circumstantial; do you have a second track of evidence?” Yes. C) Video interviews of the founder discussing the origin of his IP: I think criminal psychologist will conclude he’s repeatedly deceptive and that on the Close.io YouTube channel he displays bad faith and malice youtu.be/L6JMwNJatL8 + jsfiddle.net/1mbc8tk2 The devil’s in the details: I think the facts show reasonable suspicion of a sophisticated IP crime. There aren’t two sides to the truth, there’s just the truth.
Reading Prosecuting IP Crimes (DOJ website), I think an investigation will prove that my IP was misappropriated by people who knew it was proprietary, not for them, protected from public access, and that operating it for profit in commerce would cause me harm (p. 160). Furthermore, in US v. Chung, the court held misappropriation that occurred before the 5-year statute of limitation does not defeat a trade secret prosecution because possession of trade secrets is a continuing offense (p. 175). While Chung couldn’t operate an airplane factory, the Close.io founders and YCombinator had the skills and connections to launch, finance and operate the software.
I also think that Close.io is part of a broader conspiracy. How could criminals make billions? Startup incubators and entrepreneurs worldwide use YouNoodle. It could be that YCombinator has fraudulent access to all the IP submitted to YouNoodle, recycles a few nuggets a year into pivots, and resells the ones that work for hundreds of millions, each.
Stealing intellectual property works, but it’s a multi-million dollar fraud. It’s stealing people’s careers, a lifetime of work, and then deceiving everyone, everyday. I hope truth seekers will see the violence and injustice.