Both Tesla and Fisker plan to sell a new generation of electric vehicles - Tesla with its recently launched all-electric Roadster and Fisker with its future Karma plug-in hybrid luxury saloon. The two carmakers are now tied up in a lawsuit with Tesla claiming design and trade secrets for a future electric sedan were ‘borrowed’ by Fisker Coachbuild – the company originally commissioned by Tesla to design the car.

The lawsuit contends Fisker founder Henrik Fisker and its chief operating officer Bernhard Koehler fraudulently agreed to take on a $875,000 design contract from Tesla to gain access to confidential design information and trade secrets, only to release a competing vehicle – the upcoming Karma sedan.

After finishing up at Tesla, Henrik Fisker set about launching a new company, Fisker Automotive, with backing from venture capital firm Kleiner Perkins Caufield & Byers. Sergey Brin and Larry Page, whose Google search engine was originally backed by Kleiner Perkins also, were both Tesla investors.

Tesla also claims that before doing design work for their new sedan, which was meant to be a plug-in hybrid just like the Karma, Mr. Fisker had no experience with hybrid technology. They also claim he did substandard work for Tesla, essentially sabotaging it, and then used the revenue from the design contract to develop his own car, reports the New York Times.

The lawsuit seeks to stop Fisker Automotive from using Tesla’s design documents, along with a return of the money from the contract and unspecified punitive damages.