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Palantir Has Filed a Dramatic Lawsuit Against a Major Early Investor

September 6, 2016, 2:59 PM UTC
Allen & Co. Media And Technology Conference
Alexander "Alex" Karp, chief executive officer and co-founder of Palantir Technologies Inc., arrives for a morning session during the Allen & Co. Media and Technology Conference in Sun Valley, Idaho, U.S., on Wednesday, July 9, 2014. Technology companies from Silicon Valley are expected to take center stage at this year's Allen & Co.'s Sun Valley conference as tech and media converge. Photographer: Daniel Acker/Bloomberg via Getty Images
Photograph by Daniel Acker — Bloomberg via Getty Images

Palantir, a secretive firm that supplies data analytics to companies and governments, filed a dramatic lawsuit against one of its early investors, claiming the investor stole confidential information for his own use.

In a complaint filed last week in California state court, Palantir alleges Marc Abramowitz betrayed the company by asking for confidential information about key projects in fields like cyber-insurance and clinical drug trials, and then filing for patents based on what he learned.

Abramowitz is a 63-year-old investor and lawyer who lives in Palo Alto and maintains a low public profile. Palantir’s complaint describes him as a “Major Investor” because he owns at least five million shares in the company, and because as a long-time adviser who spent so much time at the firm, he even asked for an office in 2014.

Palantir was co-founded in 2004 by mercurial billionaire Peter Thiel. It offers its analytics service to an extensive list of clients in the private sector and, more recently, has made major inroads into Washington, D.C.

The complaint, which was spotted by, is available online here. (I’ve underlined some of the most relevant bits.)

The complaint describes Abramowitz’s behavior as “brazen,” including an alleged series of visits in which he asked executives to share information about secret business plans in order to use the information for himself. It also says his lawyers invoked an Investors Rights Agreement to demand confidential documents.

According to Palantir, other investors sought to stop him by amending the company’s corporate documents on September 1.

Fortune sought comment from Abramowitz via two law firms that are representing him but did not immediately receive a response.

Palantir’s allegations, if true, are remarkable—especially the ones concerning Abramowitz’s intellectual property filings. The company says these amount to false claims to the U.S. Patent and Trademark Office.

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A review of those filings include at least five patent applications with titles like “Dynamic Analysis of Health and Medical Data” and “Dynamic Security Rating for Cyber Insurance Products.” Palantir says, in one, case it filed an extremely similar patent application shortly right before Abramowtiz did, but that he never cited or credited the company in his filing.

Abramowitz also filed for a trademark application for the word “Shire,” which Palantir claims is an attempt by Abramowitz to piggyback on the company’s reputation:

Palantir’s company name is inspired by the “seeing stones” referenced in The Lord of the Rings. Without Palantir’s knowledge, Abramowitz filed for a trademark on the mark “Shire,” which is also referenced in The Lord of the Rings as the place where one of the main characters lives … in an attempt to further improperly associate himself with what he views as the Palantir brand.

In response, Palantir is asking the court to forbid Abramowitz from using its confidential information, and to order him to destroy any related documents or emails. The company is also seeking financial damages, and is suing Abramowitz personally as well as a company, KT4 Partners, and a charitable trust he controls.

The complaint accuses Abramowtiz of breach of contract, bad faith, and a series of violations of California state law, including fraudulent business practices.

Palantir, which declined to comment about the lawsuit, received a $20 billion valuation in 2015. Earlier this summer, it announced plans to purchase $225 million in stock from current and former employees at $7.40 per share.