On Wednesday, a California court dismissed an intellectual property (IP) theft lawsuit against Chinese mixed reality company Nreal filed by a former employer of its founder, according to court documents sent by Nreal to TechNode. US-based rival Magic Leap accused Nreal founder Xu Chi of stealing MR glasses technology while working there.

Why it matters: The Nreal-Magic Leap lawsuit is the latest in a series of IP theft accusations against Chinese-born former employees of American companies.

  • Magic Leap is backed by Alibaba and Google. It built the contested product, a set of mixed reality glasses, in seven years, using $2 billion in investment.

From the beginning we’ve firmly stated that Magic Leap’s claims against Nreal are meritless. The fact that the court found that Magic Leap failed to state a single viable claim is telling.

Xu Chi, Nreal CEO and founder, in an emailed statement to TechNode

Details: In granting the motion to dismiss, the court found that Magic Leap’s case against Nreal failed to explain how the alleged IP theft happened.

  • Nreal filed a motion to dismiss in December 2019. It said that the allegation was “vague and unsubstantiated.”
  • The Florida-based AR maker is “filing lawsuits to slow down new entrants in the AR market,” Nreal added in a statement at the time.
  • The court ruled that Magic Leap’s allegation that Nreal founder Xu Chi breached confidentiality agreements had “no factual support.”

Context: Chinese companies whose products look similar to US-developed counterparts are often faced with accusations of theft—especially if they share staff. But “inspired by” products aren’t necessarily illegal.

  • Tesla was recently rebuffed in a bid to use a copycat case against an individual Xpeng engineer as warrant for a wide-ranging review of the Chinese EV company’s internal data.
  • Beijing-based Seengene has also developed MR glasses that look a lot like Google Glass, but have integrated 3D visualization and navigation technology to set them apart.

READ MORE: For Chinese startup Seengene, the future is grounded in mixed reality

Eliza Gkritsi

Eliza is TechNode's blockchain and fintech reporter. When she isn't obsessing over the rise of distributed ledger technology in China, she helps with editing.