AI startup accuses Facebook of stealing code designed to speed up machine learning models on ordinary CPUs

Neural Magic claims algos in social network's open-source compiler on GitHub look awfully familiar

Abstract image of a CPU

An AI startup is suing Facebook and one of its employees for allegedly stealing proprietary software that allows machine learning workloads to run faster on standard processors, eliminating the need for more expensive custom hardware.

Neural Magic, founded in 2017 by Nir Shavit and Alex Matveev, describes itself as a "no-hardware AI" company. Instead of relying on GPU chips that are able to crunch through matrix maths operations to run machine-learning models quickly, the Boston-based upstart employs nifty software tricks to achieve similar speeds on CPUs.

Court documents filed (PDF) in the District Court of Massachusetts last week claim that Neural Magic's first employee, Aleksandar Zlateski, breached the non-disclosure and non-competition agreement he signed when he joined as the company's technology director. Zlateski left to join Facebook and allegedly stole his former employer's secret algorithms to give to his new team.

That code, describing how to perform low-precision matrix multiplication to run trained computer vision models, was then published by Facebook engineers on GitHub last year in November. Facebook also released a compiler known as "Sparse GEMM JIT" as part of its efforts to expand PyTorch, a machine learning framework commonly used by AI developers.

Neural Magic claims in the filing that "the code and compiler Facebook posted to GitHub implement the same Neural Magic Algorithms used in Neural Magic's compiler code, to achieve the same computational and storage efficiencies running on commodity hardware (CPUs).

"Indeed, Neural Magic has tested the Facebook compiler side-by-side against its compiler, and the results from this direct comparison establish that the algorithms implemented in the Facebook compiler are the Neural Magic Algorithms."

On top of that, the technical lead and manager at Facebook AI Systems Co-design, Jongsoo Park, even singled out Zlateski for his contributions on the project's GitHub depository, Neural Magic's complaint argued.

But when the startup wrote Facebook and Zlateski letters in an attempt to get the social media giant to take down its code from GitHub, both parties declined. "In a series of letters, counsel for Facebook and Zlateski flatly refused to take down the code or agree to cease further use of Neural Magic's proprietary and confidential information that Zlateski misappropriated as a Facebook employee," the court document said.

In retaliation for that refusal, Neural Magic decided to take legal action. Now it believes that Zlateski breached the non-disclosure and non-competition agreement he signed in March 2018. Neural Magic has also claimed that its former employee and the social media giant have violated trade secret laws. It is now seeking "punitive damages", an injunction to prevent Facebook and Zlateski from using its proprietary algorithms, and wants to slurp Zlateski's Facebook assets and shares.

Zlateski was employed at Neural Magic from March 2018 to July 2019. He was offered a base salary of $165,000 per year as technology director and was also given the opportunity to purchase the startup's shares. Neural Magic raised $15m in seed investment led by Comcast Ventures and other VC firms including NEA, Andreessen Horowitz, Pillar VC and Amdocs in November last year.

Facebook and Neural Magic's Shavit declined to comment. ®

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