WSJ reports that startup LimitNone is suing Google for breach of contract and trade secret misappropriation:
LimitNone, which no longer offers the product, says it worked on gMove as a member of an authorized Google developer program and with the assurance that Google wouldn't seek to build a similar tool itself.
Looks like contracts and trade secret protection weren't the right way to go for LimitNone. I've been involved with a few trade secret lawsuits, and they are very messy. People complain all the time about how difficult it is to interpret patent claims, and how poor the patent office is at examining them. But filing a patent application does do one thing extraordinarily well: it plants a stake in the ground that says: "On this date, our startup knew this much about the technology and thought this part was what was valuable."
With that stake in the ground, the discussion about who did what when gets much simpler. That's because describing the scope of the trade secret is only the smaller part of what makes trade secret lawsuits messy. The larger part of the messiness is due to the competing claims between joint developers for ownership of the IP in question.
When a patent application is filed, some questions about validity and all questions about infringement are left to be determined later. But the process of drafting the application and getting assignments tends to resolve ownership questions earlier, and at the moment in time when they are easiest to resolve. A good patent lawyer will sit down with the various parties involved with a development effort, make a determination as to who contributed to conception, when, and what each person's obligations were and to whom at that point in time. A couple hours worth of work can avoid millions of dollars of litigation.