Palantir sues Y Combinator-backed startup Guardian AI for trade secret theft

Palantir Technologies has taken two of its former employees and their startup, Guardian AI, to the U.S. District Court for the Southern District of New York over what it termed a brazen theft of trade secrets. 

The lawsuit alleges that Mayank Jain and Pranav Pillai, founders of Guardian AI, stole proprietary information from Palantir while still employed at the company and used it to establish their own venture.

Allegations of trade secret theft against Guardian AI

Palantir, widely known for its defense technology solutions, also has a significant presence in the healthcare industry. The company claims that Guardian AI , a Y Combinator-backed startup that helps healthcare providers challenge insurance claim denials using artificial intelligence (AI), was built on stolen trade secrets. Palantir claims to provide a similar service, which it said helps to reduce administrative burden among other benefits.

According to the lawsuit filed in early March , Palantir claims Pillai and Jain took proprietary work and used it to apply to leading startup incubator, YC with the aim of commercializing them for their own financial gain. It also said they did this while still being Palantir employees and working on the firm’s projects.

The lawsuit claims that Pillai and Jain got into the YC 2024 summer program and reportedly got $500,000 in funding from the incubator. That was when they incorporated their new startup in San Francisco a few days after leaving Palantir.

The tech giant also claims that the Guardian AI founders boasted that they had released their solutions and saved customers more than $150,000. They reportedly made these claims a few weeks after their resignation from Palantir, with the prosecutor adding that the defendants’ work ripped off their former employer.

As part of its legal action, Palantir seeks three times the amount of proven damages their defendants’ actions have cost Palantir and attorney’s fees for the ongoing case of alleged trade secret theft. They also intend to start arbitration against the founders to get back the compensation they received when they were Palantir employees.

When reached for comments on the matter, Jain reportedly said, “This is quite new and we’re working on resolving it with Palantir at the moment.”

A promising financial year for Palantir and its healthcare division

According to Jeremy David , Palantir’s co-head of healthcare, the division was responsible for 15% of Palantir’s commercial business. He added that they are focused on finding the most important workflows that are broken and providing solutions to them.

Palantir’s healthcare division reportedly grew 267% between 2020 and the first half of 2022. In a post on X in August 2024, Shyam Sankar, Palantir’s chief technology officer, said that the AI firm’s software managed 21% of hospital beds in the U.S. and called the healthcare division one of their fastest-growing areas.

Palantir , which has a market cap of $198 billion, reported $2.9 billion in revenue last year, a 29% increase over what it made in 2023. For 2025, the company is expecting a revenue of north of $3.7 billion.

So far, neither Palantir nor its attorneys, Skadden Arps, have made any comments regarding the lawsuit.

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