Valley’s Green Car Feud: Tesla Sues Fisker

Tesla and Fisker Automotive, the two electric-car startups backed by Silicon Valley’s most well known cleantech VCs, are involved in a now very public feud. On Monday Tesla filed suit in Superior Court in California alleging that Fisker stole Tesla’s design ideas and trade secrets.

The New York Times digs up the details and says Tesla hired Henrik Fisker, founder of Fisker Automotive, last year to do some design work for the body of Tesla’s sedan, code-named White Star. Tesla says Fisker and Fisker’s COO Bernhard Koehler entered into a $875,000 design contract with Tesla then walked away with trade secrets and launched their own competing car. (Here’s our previous interviews with Fisker, and Tesla’s Chairman and CEO.)

Whoa. Fights in the Valley’s very small world among competitors aren’t uncommon, but this one’s a doozy. Particularly because each startup is backed by competing venture firms. Tesla is backed by Elon Musk, VantagePoint Venture Partners, Draper Fisher Jurvetson and individual investors, including Jeff Skoll and Google’s Larry Page and Sergey Brin. Fisker, on the other hand, is backed by Kleiner Perkins Caufield & Byers and has KP’s Ray Lane on its board.

Tesla’s VP of sales, marketing & service, Darryl Siry tells us that Tesla worked with Henrik Fisker between the end of 2006 and the end of 2007. During that time Siry says Fisker produced designs for White Star that weren’t quality, and in hindsight Siry says it’s not a surprise that Fisker ended up producing a competing car. Tesla filed the suit for breach of contract and is also asking for unspecified damages beyond that.

There are some similarities in the companies vehicles. Fisker’s Karma is a range-extended electric car, and cost $80,000. Tesla will also offer a range-extended version of its next-gen car code-named White Star for around $50,000. In an interview back in February we actually asked Henrik Fisker if “After watching Tesla get its Roadster to market this year and now start work on the White Star, is there anything you have learned from Tesla’s mistakes or successes?” Fisker said:

We do not compare ourselves to other startup companies. We believe we are a different type of startup, as all of our people come from the automotive industry and have extensive experience with the automotive industry. We are therefore taking a different approach, knowing how complicated it is to bring a vehicle to the market.

The two startups also have the added layer of trying to keep their companies’ images as “green,” altruistic climate-change fighters, and a lawsuit like this shines light on what’s actually at stake: a whole lot of money. On that note, The New York Times has the money line:

“I think it’s ironic that Fisker chose to name his car the Karma, when what he’s done is very bad karma,” Adam C. Belsky, a lawyer at Gross, Belsky & Alonso who represents Tesla.

We’re contacting the companies and will add more when we learn more.