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Check the TUPE: Facebook's hire of Bloomsbury AI founders wasn't 'traditional' acquisition - so sacked bod can't claim law was broken

So says the UK's Employment Tribunal in unfair dismissal case

A “very highly qualified and experienced expert in artificial intelligence” who founded a misinformation-fighting startup has lost a legal case against Facebook in London for unfair dismissal.

Guillaume Bouchard lost his Employment Tribunal case after Employment Judge N Walker ruled that Facebook had “acqui-hired” key personnel from his Bloomsbury AI startup. Had the Mark Zuckerberg-run biz acquired "business activity", clients, contracts or intellectual property, rather than doing a multi-million dollar deal predicated on hiring its key personnel, he would have had an arguable case.

Bouchard's submission had been that "this talent acquisition or what was sometimes called 'acqui hire' achieves the same objectives as a traditional acquisition and was essentially a TUPE transfer by another name."

If it were a TUPE transfer, Bouchard would have had the two years’ service required to claim for unfair dismissal.

The judgment also confirmed that Facebook’s London AI research base has been actively trying to create tools to detect child abuse and terrorist content that will work after the introduction of end-to-end encryption (E2EE).

Bouchard’s company had grown out of University College London’s AI research community. The startup was acquired by Facebook in 2018 so the social networking site’s London tentacle could get access to its natural language processing (NLP) smarts.

“Multiple sources say Facebook is paying between $23m and $30m to acquire Bloomsbury AI, in a deal that will see a mixture of cash and stock change hands,” reported Techcrunch at the time.

After the buyout things were less clear-cut, as the April 2021 judgment (published last week) recounted. Bouchard, Bloomsbury’s CTO Sebastian Riedel and UCL AI researcher Tim Rocktäschel all visited Facebook HQ in Menlo Park, California, during May 2018. Facebook liked what it saw and hired the trio.

Once the dust had settled they were put to work starting in August that year on “News Feed integrity issues.” After five weeks in Facebook’s internal “bootcamp”, including another trip to America, they were broadly tasked with “work related to misinformation, polarization, and harm in conversations”, though the judge found: “It is clear that they were not given any specific tasks but were expected to liaise with other teams and work to find synergies.”

“With the Harmful Behaviour team, he has come up with two concrete projects that are now being scheduled for 2019 H1 goaling: age detection (crucial to IIC/Grooming work), and sequential models (as an extension of existing behavioural classifiers once E2EE comes into force),” said an internal email written in late 2018, referring to Bouchard’s workload.

The judge was seemingly so taken with the detail of Facebook’s acquisition processes and AI research that the case's judgment did not mention when Bouchard was sacked or why. It did, however, outline the legal arguments.

Although neither Bouchard nor Facebook disputed that he and his key cofounders had been hired by Facebook, the former argued that because they were brought in as a group and were mostly treated as a team within the social networking firm, the company had, de facto, bought out Bloomsbury AI as a "corporate entity".

Therefore, Bouchard argued, firing him meant Facebook was liable for unfair dismissal because TUPE (the Transfer of Undertakings (Protection of Employment) regulations meant he couldn’t be sacked without notice.

The judge found otherwise, ruling that each cofounder had been hired individually – and therefore TUPE didn’t apply. Moreover, as Bloomsbury had no customers (its sole product was an AI-powered Q&A system for unstructured text inputs) Bouchard could not prove there was “customer goodwill” that went with the acqui-hire: a strong argument against Facebook having acquired a corporate entity instead of a loose group of individuals.

As for Bloomsbury's software, Cape, "an artificial intelligence that reads text documents and answers questions about their contents," the judge noted "the founders of Bloomsbury were happy to negotiate with their investors to close it down and make that open source, so that it had no value."

“The consequence of this determination is that the Claimant has less than two years’ service, and thus is insufficient qualifying service for a claim for ordinary unfair dismissal. Accordingly, that claim is struck out,” concluded the judge.

The full judgment can be read here. ®

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