However, even if we entertain the notion that Jeremy had some sort of de-facto equity interest in the company (a claim for which there is seemingly zero present evidence); can we at least agree that is uniquely shitty to suddenly level these claims days after the acquisition is announced?
One does wonder why this moral injustice wasn't righted promptly in the days, weeks, months, or years following his involvement in the company. More facts will likely emerge, but the timing alone seems like prima facie evidence of rank opportunism on his part.
Would you prefer that he wait until after the acquisition closes and then have to fight a multi-billion dollar corporation and a newly minted billionaire cofounder? He obviously feels he is owed something, and strategically, it was now or never.
I cofounded a company, named it, was listed as the inventor on the company's patents, wrote its first product, had a written equity deal, and still got screwed on an acquisition like this. It wasn't for billions, but it was for more than $60 million. The acquirer was a multi-billion dollar company and once the deal was done (I didn't find out about the acquisition until after the fact) it was impossible for me to fight them.
I don't know what the merits of his case are, but looking at this from Jeremy's side, having been similarly positioned, he had no choice but to do this right now. Once GM has the company, unless Jeremy has some insanely wealthy backers willing to fund a very expensive legal fight for many years, all bets are off.
not the "This is the right time to start a certain business" kind of way
This fully describes most of the VC-backed startup world. 95+% of the businesses fail and a few get lucky. Part of making that happen is trying just about anything and shooting for the moon.
Keep in mind you're talking about Kyle Vogt, cofounder of Justin.tv and Twitch.tv, acquired by Amazon for $1B, and Socialcam, acquired by Autodesk for $60M.
I guess he probably isn't a billionaire if he only got a percentage of those acquisitions but he isn't some poor college kid hacking away in a garage either.
Note that I am not saying anything about the merits of this case one way or the other, just pointing out who we're talking about.
Were you due millions and got nothing, or did you just lose some of what you felt you were due? What would you suggest others do in order to avoid that situation of yours?
It turns out, however, that the moment I was out he transferred all of the company's IP to a different corporate entity that he owned 100℅ of (same exact company name, just a different structure). He eventually sold that entity. The only thing he couldn't erase was my name being on the patents, but apparently the acquiring company never bothered asking who I was. But in the end it didn't matter, I simply didn't have enough resources to see it all the way through.
But it also sounds batshit crazy... shareholders should have more than just 'trust' that a founder isn't going to screw them over so easily.
I know someone who went up against a Dow 30 tech company like this, won $8 million, and walked away with $2 million after tax. Let me know if you want more details, I'll email you.
I'll reserve my opinion.
So yeah I wasn't going to name names, but since you posted this old link, in my opinion, no one should ever do business with Allan Camaisa. He is the CEO of a different tech startup today in the mobile space, and I can only assume he is screwing people both inside and outside the company in the same way and possibly new and improved ways.
If you would like to see the ire this guy inspires in business associates, look no further than http://eyevelocity.com . This was a dot com era implosion that he was the CEO of. Allan blew through $40 million of "smart" money - Intel Capital, Chase H&Q, etc. and the company went bankrupt. A spurned employee bought the old domain and 15 years after they blew up is apparently still bitter based on the home page lol (HTS was the parent company of Eyevelocity). His very next venture after that disaster was the one we started together.
Thanks for sharing that story with me. It's so stressful thinking about the stuff that can happen, esp when doing business with peeps you know.
In any case, it's just more evidence that getting something in writing re: ownership is worth it from the first conversation you ever have about a potential startup. If these two guys did something simple and standard like 50/50 with vesting, this wouldn't have been a problem.
Again, that's not necessarily the truth, but if you want to understand the psychology of how someone can claim this stuff and feel reasonable about it, that's how. We've very much only heard one side of this discussion and while Altman's side is very reasonable, it'd be interesting to see the other side.
We were involved in a fracas something like this, but on a smaller scale.
One of my key learnings was exactly this. Our lawyer (a magnificent guy who stewarded through the ugly process) said early on "you can bet that the other guy's lawyer is getting an entirely different story from what you've told me".
Much as we (especially techies) like to think of ourselves as binary,rational types, the fact is that two intelligent people can each hold conflicting, but sincerely held worldviews. Its very hard to get your head around this - the natural thing is to got full on fight instinct - he's a bastard, he's lying, he's out to screw me and my family, he'll say anything.
Add on top the fact that things often are gray - likely in this case there are two sides to the story, other guy probably has a rightful beef about this.
THIS! A thousand times over. The mere fact that a generous settlement was turned down seems to indicate both sides sincerely believe they are in the right and not some "out of the woodworks charlatan as sama has us believe..."
Both the following statements are true: 1) lots of these cases are filed right before a merger because plaintiffs hope to maximize defendants' incentive to settle a weak claim; 2) lots of these cases are filed right before a merger or acquisition because until then the defendant has no money and there is little incentive to bring even a strong claim against them.
Assuming someone has been legitimately wronged, they are entitled to surface their claims at the time that would give them the best chances of righting that wrong - ie, the time at which they have the most leverage.
There are legal arguments bearing on delayed claims (eg laches) but those are for the court to resolve.
It could be as simple as the plaintiff living a busy life and realizing this was his last chance to make things right before he'd be facing GM's lawyers. GM is definitely of the size where they can bring a trial outside the means of an individual to litigate.
The valid reasons to attack are listed at the bottom of Sam's article.
That's not how it works. We have great, special-built instruments for this purpose, commonly known as stock options. They come in many flavors, but all of them share the important feature of defining terms of ownership before it's obvious what the final value of a company will be. These tools exist for the express purpose of avoiding shadow claims and massive litigation every time a company is bought or sold.
Or a result of feeling the full weight of his mistake/perceived injustice.
If you know for sure that the stock is effectively worthless, obviously there's no point.
If the stock might be effectively worthless, or might not, then there is a point: you are establishing your claim before its value is known. That puts you in a much better position to rebut accusations that you don't really have a valid claim but are trying to milk it for whatever you can.
It certainly looks like there are in the court filing that sama's article links to.