Indiana-based engine maker Cummins is facing a lawsuit from a tech company for allegedly violating a contract and intellectual property law by stealing an artificial intelligence tool that reduces emissions.
The legal action is the latest hurdle in Cummins’ challenging path to its goal of zero emissions by 2050.
Last year, Cummins had to pay $2 billion to settle a federal investigation into its use of illegal devices that prevented emissions tracking and control. Around that time, the company offered employee buyouts.
Earlier this year, the company announced layoffs, saying the staff reductions would allow the company to reduce administrative layers and focus on core business. A company representative framed the job cuts and restructuring as part of Cummins’ overall effort to reduce emissions.
The ongoing lawsuit says that Cummins hired tech company C3.ai to develop a tool that can adjust engine settings to use the least amount of fuel in different environments. The California-based artificial intelligence company alleges that Cummins used source code and information sessions to replicate the tool.
Cummins officials declined to comment on the specific allegation but stressed that they “are committed to conducting our business with the utmost integrity and respect for the law.”
“We are confident in our position and are vigorously defending these claims,” a spokesperson said in an email to IndyStar.
A leaked email
Disputes over intellectual property are common in the business world, especially when companies work together, said Cara Putman, a Purdue University professor with expertise in intellectual property, contract law and ethics.
The key to winning these cases is to prove one company intentionally replicated a product design and produced something that was “substantially similar” to another product.
C3.ai seems to think they have a smoking gun. In the lawsuit, the AI company said they received an email from Cummins in 2023 that accidentally included plans to take “learnings from the C3 AI development work” with a development team in India. Doing that, the C3.ai lawsuit says, violates the contract Cummins signed.
Later that year, Cummins ended its contract with C3.ai.
Putman said this case highlights the need to protect proprietary information.
“It’s a great example of the critical role that IP plays when companies are working together and contracting,” she said. “They need to be actively thinking about how they’re going to interact and relate to each other.”
Cummins under pressure
Engine makers and manufacturers are under pressure to shift toward clean energy after world leaders committed to reaching zero emissions by 2050, driving demand for products with reduced emissions.
While Cummins has been a leader in this transition, the company has also struggled to adapt.
These tightening regulations can be costly for companies who have to revamp their productions and develop new technologies, experts say. A recent financial report revealed that the company also wants to reduce its debt.
If the lawsuit prevails, Cummins may face more financial woes. C3.ai said they’re waiting for more information to determine the damages but estimates them to be between $500 million to $1 billion.
Binghui Huang can be reached at 317-385-1595 and [email protected]
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