Scale AI, which helps tech corporations put together knowledge to coach their AI fashions, filed a lawsuit in opposition to considered one of its former gross sales staff and its rival Mercor on Wednesday. The go well with claims the worker, who was employed by Mercor, “stole greater than 100 confidential paperwork regarding Scale’s buyer methods and different proprietary info,” in line with a duplicate seen by TechCrunch.

Scale is suing Mercor for misappropriation of commerce secrets and techniques and is suing the previous worker, Eugene Ling, for breach of contract. The go well with additionally claims the worker was attempting to pitch Mercor to considered one of Scale’s largest clients earlier than he formally left his former job. The go well with calls this firm “Buyer A.”

Mercor co-founder Surya Midha denies that his firm used any knowledge from Scale, though he admits that Ling might have been in possession of some.

“Whereas Mercor has employed many individuals who departed Scale, now we have little interest in any of Scale’s commerce secrets and techniques and actually are deliberately working our enterprise differently. Eugene knowledgeable us that he had previous paperwork in a private Google Drive, which now we have by no means accessed and at the moment are investigating,” Midha informed TechCrunch in an emailed assertion. 

“We reached out to Scale six days in the past providing to have Eugene destroy the recordsdata or attain a special decision, and we at the moment are awaiting their response,” Midha stated.

Scale alleges that these paperwork contained the particular knowledge that may enable Mercor to serve Buyer A, in addition to a number of different of Scale’s most vital purchasers.

Scale wished Mercor to provide it a full checklist of the recordsdata within the drive, and to stop Ling from working with Buyer A. It alleges within the go well with that Mercor refused. Ling didn’t instantly reply to TechCrunch’s request for remark.

There are scant clues within the go well with in regards to the id of Buyer A. The go well with does say that if Scale’s rival did win this buyer away, it might be a contract “value hundreds of thousands of {dollars} to Mercor.”

Regardless of the particulars of this go well with, it does present one factor: Scale is clearly involved sufficient about the specter of Mercor to pursue authorized motion. As TechCrunch beforehand reported, even with Meta’s multibillion-dollar funding into Scale, TBD Labs — the core unit inside Meta tasked with constructing AI superintelligence — remains to be utilizing Mercor and different LLM knowledge coaching service suppliers.

Mercor is rising within the LLM coaching enviornment as a result of it’s identified for hiring content material specialists, typically PhDs, to coach LLM knowledge of their areas of experience.

In June, Scale introduced that Meta was investing $14.3 billion for a 49% stake in Scale and was hiring away its founder. Shortly after that, a number of of Scale AI’s largest knowledge clients, who’re rivals to Meta’s efforts, reportedly minimize ties with it.