Featured Article

Cruise reveals DOJ, SEC probes as it releases internal report on pedestrian crash

Poor leadership, mistakes in judgment led to loss of robotaxi permit, report finds

Comment

SAN FRANCISCO, CALIFORNIA - JUNE 08: Chevrolet Cruise autonomous vehicles sit parked in a lot on June 08, 2023 in San Francisco, California. Autonomous vehicle companies Cruise and Waymo have been testing their vehicles throughout San Francisco and residents are not happy with the problems that the cars are bringing to the city. The cars frequently stop in the middle of roads for no reason, have driven through police crime tape and most recently struck and killed a dog. (Photo by Justin Sullivan/Getty Images)
Image Credits: Justin Sullivan / Getty Images

Cruise, the GM self-driving subsidiary, said Thursday that federal prosecutors and securities regulators have opened investigations into the October 2 incident that left a pedestrian stuck under and then dragged by one of its robotaxis.

The probes by the Department of Justice and the Securities and Exchange Commission, which were revealed as part of an internal report conducted by law firm Quinn Emanuel Urquhart & Sullivan and released Thursday, join numerous other investigations at nearly every level of government, including the California Department of Motor Vehicles, the California Public Utilities Commission and the National Highway Traffic Safety Administration.

The October 2 incident — and the decisions by Cruise leadership in the days following — has put the company’s future at risk, forcing GM to slash costs and take greater control of the troubled company. Cruise lost the permits it needed to operate commercially in the state of California and has since grounded its fleet elsewhere. Its co-founder and CEO Kyle Vogt resigned and nearly 24% of its workforce had been laid off in the wake of the event.

Problems with Cruise began almost immediately after the company received the last remaining permit required to operate its robotaxi service commercially throughout San Francisco. But it was the October 2 incident, and the decisions and communication immediately following, that sent the company into free fall.

On that day, a pedestrian crossing a street in San Francisco was initially hit by a human-driven car and landed in the path of a Cruise robotaxi and run over. It wouldn’t be until days later that media and some regulators learned that the stopped robotaxi then tried to pull over, dragging the pedestrian 20 feet. It was that lack of disclosure — along with the robotaxi’s decision to execute a dangerous maneuver — that escalated Cruise’s already tentative relationship with regulators.

The California DMV, which regulates the testing and deployment of autonomous vehicles in the state, accused Cruise of withholding video footage from its investigation, prompting the agency to suspend its permits.

That video footage, and whether it was purposely withheld, was a central question in the review conducted by Quinn Emanuel. The law firm, which was hired by GM, concluded that Cruise didn’t purposely mislead regulators. Instead, a lack of judgement, missteps by leadership, an “us versus them” relationship with regulators and a fixation on correcting the inaccurate media narrative that the Cruise AV, not the human-driven Nissan, had caused the accident were all contributing factors to Cruise’s problems, according to the 195-page report. 

“This myopic focus led Cruise to convey the information about the Nissan hit-and-run driver having caused the Accident to the media, regulators, and other government officials, but to omit other important information about the Accident. Even after obtaining the Full Video, Cruise did not correct the public narrative but continued instead to share incomplete facts and video about the Accident with the media and the public. This conduct has caused both regulators and the media to accuse Cruise of misleading them.”

Curiously, the Quinn Emanuel report focuses less on the technology, which caused the vehicle to pull over and drag the pedestrian, and more on what happened after October 2. At one point, the report calls the loss of DMV permits a “proverbial self-inflicted wound by certain senior Cruise leadership and employees who appear not to have fully appreciated how a regulated business should interact with its regulators.”

Quinn Emanuel said that by October 3, more than 100 Cruise employees, including some senior members of its senior leadership, policy, legal, government affairs, and systems integrity teams were informed prior to their meetings with regulators that the Cruise AV had moved forward after the initial pedestrian impact and, in doing so, had dragged the pedestrian for approximately 20 feet.

Instead of explicitly describing to regulators what happened, Cruise employees just played the full video in these meetings, including numerous times when internet connectivity may have hampered or prevented them from seeing it in its entirety.

“Because Cruise adopted that approach, it did not verbally point out these facts. This is because Cruise assumed that by playing the Full Video of the Accident for its regulators and other government officials, they would ask questions and Cruise would provide further information about the pullover maneuver and pedestrian dragging,” the report reads.

The report also found that some of the most critical leaders at Cruise, including Vogt, Chief Legal Officer Jeff Bleich and COO Gil West appeared to be playing catch up after the DMV suspended the permits.

In Slack messages reviewed by Quinn Emanuel and highlighted in the report, Vogt expressed frustration about the DMV Suspension Order, writing “I am very much struggling with the fact that our GA team did not volunteer the info about the secondary movement with the DMV, and that during the handling of the event I remember getting inconsistent reports as to what was shared. At some point a bad judgement call must have been made, and I want to know how that happened.”

The report notes that the Slack messages between Bleich, West and Vogt “convey that the three senior leaders of the company — the CEO, CLO, and COO — were not actively engaged in the regulatory response for the worst accident in Cruise’s history. Instead, they were trying to piece together what happened after the fact.”

More TechCrunch

In an interview at his home near Reykjavík, the entrepreneur-turned-VC shared thoughts on his ventures and the journey that led him from Unity to climate tech, a homecoming of sorts.

Unity co-founder David Helgason’s next act: Gaming the climate crisis

Welcome back to TechCrunch’s Week in Review — TechCrunch’s newsletter recapping the week’s biggest news. Want it in your inbox every Saturday? Sign up here. Over the past eight years,…

Fisker collapsed under the weight of its founder’s promises

What is AI? We’ve put together this non-technical guide to give anyone a fighting chance to understand how and why today’s AI works.

WTF is AI?

President Joe Biden has vetoed H.J.Res. 109, a congressional resolution that would have overturned the Securities and Exchange Commission’s current approach to banks and crypto. Specifically, the resolution targeted the…

President Biden vetoes crypto custody bill

Featured Article

Industries may be ready for humanoid robots, but are the robots ready for them?

How large a role humanoids will play in that ecosystem is, perhaps, the biggest question on everyone’s mind at the moment.

20 hours ago
Industries may be ready for humanoid robots, but are the robots ready for them?

VCs are clamoring to invest in hot AI companies, willing to pay exorbitant share prices for coveted spots on their cap tables. Even so, most aren’t able to get into…

VCs are selling shares of hot AI companies like Anthropic and xAI to small investors in a wild SPV market

The fashion industry has a huge problem: Despite many returned items being unworn or undamaged, a lot, if not the majority, end up in the trash. An estimated 9.5 billion…

Deal Dive: How (Re)vive grew 10x last year by helping retailers recycle and sell returned items

Tumblr officially shut down “Tips,” an opt-in feature where creators could receive one-time payments from their followers.  As of today, the tipping icon has automatically disappeared from all posts and…

You can no longer use Tumblr’s tipping feature 

Generative AI improvements are increasingly being made through data curation and collection — not architectural — improvements. Big Tech has an advantage.

AI training data has a price tag that only Big Tech can afford

Keeping up with an industry as fast-moving as AI is a tall order. So until an AI can do it for you, here’s a handy roundup of recent stories in the world…

This Week in AI: Can we (and could we ever) trust OpenAI?

Jasper Health, a cancer care platform startup, laid off a substantial part of its workforce, TechCrunch has learned.

General Catalyst-backed Jasper Health lays off staff

Featured Article

Live Nation confirms Ticketmaster was hacked, says personal information stolen in data breach

Live Nation says its Ticketmaster subsidiary was hacked. A hacker claims to be selling 560 million customer records.

2 days ago
Live Nation confirms Ticketmaster was hacked, says personal information stolen in data breach

Featured Article

Inside EV startup Fisker’s collapse: how the company crumbled under its founders’ whims

An autonomous pod. A solid-state battery-powered sports car. An electric pickup truck. A convertible grand tourer EV with up to 600 miles of range. A “fully connected mobility device” for young urban innovators to be built by Foxconn and priced under $30,000. The next Popemobile. Over the past eight years, famed vehicle designer Henrik Fisker…

2 days ago
Inside EV startup Fisker’s collapse: how the company crumbled under its founders’ whims

Late Friday afternoon, a time window companies usually reserve for unflattering disclosures, AI startup Hugging Face said that its security team earlier this week detected “unauthorized access” to Spaces, Hugging…

Hugging Face says it detected ‘unauthorized access’ to its AI model hosting platform

Featured Article

Hacked, leaked, exposed: Why you should never use stalkerware apps

Using stalkerware is creepy, unethical, potentially illegal, and puts your data and that of your loved ones in danger.

2 days ago
Hacked, leaked, exposed: Why you should never use stalkerware apps

The design brief was simple: each grind and dry cycle had to be completed before breakfast. Here’s how Mill made it happen.

Mill’s redesigned food waste bin really is faster and quieter than before

Google is embarrassed about its AI Overviews, too. After a deluge of dunks and memes over the past week, which cracked on the poor quality and outright misinformation that arose…

Google admits its AI Overviews need work, but we’re all helping it beta test

Welcome to Startups Weekly — Haje‘s weekly recap of everything you can’t miss from the world of startups. Sign up here to get it in your inbox every Friday. In…

Startups Weekly: Musk raises $6B for AI and the fintech dominoes are falling

The product, which ZeroMark calls a “fire control system,” has two components: a small computer that has sensors, like lidar and electro-optical, and a motorized buttstock.

a16z-backed ZeroMark wants to give soldiers guns that don’t miss against drones

The RAW Dating App aims to shake up the dating scheme by shedding the fake, TikTok-ified, heavily filtered photos and replacing them with a more genuine, unvarnished experience. The app…

Pitch Deck Teardown: RAW Dating App’s $3M angel deck

Yes, we’re calling it “ThreadsDeck” now. At least that’s the tag many are using to describe the new user interface for Instagram’s X competitor, Threads, which resembles the column-based format…

‘ThreadsDeck’ arrived just in time for the Trump verdict

Japanese crypto exchange DMM Bitcoin confirmed on Friday that it had been the victim of a hack resulting in the theft of 4,502.9 bitcoin, or about $305 million.  According to…

Hackers steal $305M from DMM Bitcoin crypto exchange

This is not a drill! Today marks the final day to secure your early-bird tickets for TechCrunch Disrupt 2024 at a significantly reduced rate. At midnight tonight, May 31, ticket…

Disrupt 2024 early-bird prices end at midnight

Instagram is testing a way for creators to experiment with reels without committing to having them displayed on their profiles, giving the social network a possible edge over TikTok and…

Instagram tests ‘trial reels’ that don’t display to a creator’s followers

U.S. federal regulators have requested more information from Zoox, Amazon’s self-driving unit, as part of an investigation into rear-end crash risks posed by unexpected braking. The National Highway Traffic Safety…

Feds tell Zoox to send more info about autonomous vehicles suddenly braking

You thought the hottest rap battle of the summer was between Kendrick Lamar and Drake. You were wrong. It’s between Canva and an enterprise CIO. At its Canva Create event…

Canva’s rap battle is part of a long legacy of Silicon Valley cringe

Voice cloning startup ElevenLabs introduced a new tool for users to generate sound effects through prompts today after announcing the project back in February.

ElevenLabs debuts AI-powered tool to generate sound effects

We caught up with Antler founder and CEO Magnus Grimeland about the startup scene in Asia, the current tech startup trends in the region and investment approaches during the rise…

VC firm Antler’s CEO says Asia presents ‘biggest opportunity’ in the world for growth

Temu is to face Europe’s strictest rules after being designated as a “very large online platform” under the Digital Services Act (DSA).

Chinese e-commerce marketplace Temu faces stricter EU rules as a ‘very large online platform’

Meta has been banned from launching features on Facebook and Instagram that would have collected data on voters in Spain using the social networks ahead of next month’s European Elections.…

Spain bans Meta from launching election features on Facebook, Instagram over privacy fears