Electric car maker Rivian Automotive will go on trial over allegations that it encouraged its employees who defected from Elon Musk's Tesla to steal trade secrets, according to a tentative ruling issued by a California judge.
Rivian's stock price fell 3% in premarket trading on Wednesday.
Judge Theodore C. Zayner of the Santa Clara County Superior Court tentatively denied Rivian's motion to dismiss the lawsuit, stating Tesla presented sufficient evidence for a trial.
"Tesla's evidence establishes that some Rivian employees were less thoroughly investigated and not disciplined," the judge wrote in the tentative order.
A final hearing is set for Wednesday in Santa Clara court.
The legal battle began in 2020 when Tesla filed a lawsuit against Rivian accusing it of an alarming pattern of poaching employees and misappropriating confidential information.
While Rivian presented evidence of its investigation into the trade thefts case, the judge found it "does not conclusively establish that an investigation was adequate."
Rivian has previously denied the allegations.
Rivian declined to comment while Tesla did not immediately respond to Reuters' request for comment.
