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Sounds like they offered $4.5m ("triple the last offer" of $1.5m) to go away.

I assume the attorney would only make that statement if they had supportable documentation.

Given that Guillory appears to be a "needs a paycheck" guy that's an awful lot of money to walk away from without a damn good case.

The complaint suggests that he was asked to make up his mind really quickly without extended discussion with a lawyer.

"Altman, also said he was authorized to negotiate on Cruise’s behalf and offered Guillory triple the amount of Vogt’s previous offer, but only if Guillory would agree to sign a formal settlement agreement that same day. Cruise’s attorneys then sent Guillory a lengthy settlement demand and Altman told him he could have only two hours to propose any changes. When Guillory told Altman he would not be able to meet that deadline because he needed to review the proposed terms of the agreement with legal counsel, Altman told Guillory he should fire his lawyer if he had already retained one, and offered to send him a list of lawyers to consult. Guillory could not comply with Cruise’s unreasonable deadline, and as a result, it passed on Friday, April 8, 2016."

If this is true (and given the obvious biases being displayed by both sides, I'm not sure it is), but if it is, it would really lower my opinion of Sam Altman.

He knows exploding offers suck[0] and he knows they are used to exert time pressure on people rather than letting them make informed decisions.

I know he said in his Cruise post they had no choice because they were under time pressure themselves from the merger, but to not give him sufficient time to consult his own lawyer and to suggest instead to choose one from a list he provided, doesn't really seem like someone acting in good faith.

Whatever time pressure they are under due to the merger is only going to be intensified due to this matter and I can't help but wonder if it's made things worse.


Exploding offers suck for whom? That's what's missing from that post. They suck for the disadvantaged party. They're used because they're beneficial to the advantaged party. That blog post is propaganda for YC; it says "Hey, look, the other VCs are gonna try to be mean to you, but we're gonna be REEEEAL nice ;)". They just picked something that they knew was a pet peeve for founders and that they knew wouldn't really cost them substantially to exclude from their courting strategies (as YC already has the best reputation in the business, they don't need exploding offers to get founders to sign up with them). There was probably a list of 5 "X sucks" articles that could've been written and sama just picked the one he felt he could work with best that day. Such pieces should be recognized as the intentionally-placed PR pieces they are, instead of pretending like it's just a random, unvetted musing from the YC president.

sama really wants this deal to go through and he is pulling out all the stops to try to make it happen, including pressuring Jeremy in a way that he's already stated is unfair (though it's unclear how sincerely-held this belief is and how much is just an attempt to court more founders; sama's employment of this technique seems to imply he doesn't really think it's that bad) and then publicly shaming Jeremy to try to get control of the story's narrative and make it "lazy nerd tries to defraud noble investors who push the boundaries of tech" instead of "mega-rich investors won't let a founder get his share of a massive buyout".

Every action is a tradeoff. If I'm being honest, I would probably do a similar thing if I were in sama's shoes, and do everything I could to spin the situation in my favor, since I had already convinced myself that my position was fundamentally correct and that this guy really was trying to rip everyone off. I think most of us would, even if we're not willing to admit it on HN.

I don't disagree with anything you said.

I still hold however that if true it would lower my opinion of sama - not because he used an exploding offer, but because it would mean he set a bar he is only willing to meet when there's no disadvantage to him (everyone wants to apply to y-combinator) rather than because the bar is a worthwhile thing to aim for.

P.R. or not, he's on record as saying these types of offers are a poor way of treating people, ergo, if he used one, then by his own definition he is engaging in 'terrible behaviour'.

$4.5 million seems to me to be a very generous offer based on actual work performed, but I don't know how many people would consider 2 hours (as alleged in the complaint) to be sufficient time to assess an offer worth $4.5 million (and potentially much more).

The thing is that most of us would do as sama did and the same as Jeremy as well. I know I would. I don't claim to be an angel though....

That's damning if true, and paints YC and sama in a very poor light.

I find this hard to believe considering how strongly sama has come out against exploding offers:


Even characterizing them as "terrible behavior"

Right, but he also said:

> Given the time pressure because of the pending merger, we had to set a Friday at 5 pm deadline for Kyle’s offer, which Jeremy let expire.

Investor exploding offer:

"Given the time pressure because of other deals we're looking at"

Employer exploding offer:

"Given the time pressure because of other candidates"

Everybody has a way of dressing up an exploding offer. And FTR, I still don't believe that this is exactly what happen.

From the complaint:

the application that Vogt himself submitted to Y Combinator described repeatedly that Guillory was a founder of Cruise Automation and states unequivocally in response to a question asking “who are the shareholders and what percent does each own?” that “Cruise Automation is a Delaware C Corporation created in September 2013. 50/50 split between Kyle and Jeremy."

If true, that could be worth hundreds of millions, which is an even larger amount of money to walk away from.

If he doesn't have the money to pay the attorney out of pocket, he is then most likely going to pay them with a big % of his "winnings", if he does succeed. In which case, the attorneys would fight tooth and nail to get as much as they could "for their client."

I wouldn't read too much into that or anything said in the complaint until the actual source documents are filed and we see the response to the complaint filed in court.

That could very well be the nuisance value of the suit for them in their situation. Trying to judge a case from just the initial complaint is far too incomplete a picture to go on. I'd withhold judgement until there are more facts established that both sides have had a chance to argue over.

Almost everything you read in the media is ill-informed analysis of non-lawyers. Haven't had much good coverage since Groklaw.

I agree that the source documents are important. But the question shouldn't be whether Jeremy's side can produce them. If they couldn't, this lawsuit wouldn't be happening right now. Clearly, they think they have a significant chance of winning. Otherwise, Jeremy wouldn't have turned down $4.5 million.

I'll give you a counterexample: Paul Ceglia[0]

He claimed to own 80% of Facebook after reaching a written agreement with Mark Zuckerberg and filed a lawsuit[1]. He managed to retain some very high profile law firms to pursuit the case on his behalf.

It was only discovered later, by his own representatives, that he had forged the evidence (he had hired Zuckerberg to do some work, but not on Facebook) and the case was dismissed[2].

Facebook went on to sue the lawfirms, Ceglia was charged with fraud and last anybody heard from him he escaped house detention awaiting sentencing and is now a fugitive[3].

The entire case is fascinating

[0] https://en.wikipedia.org/wiki/Paul_Ceglia

[1] http://money.cnn.com/2010/07/20/technology/facebook_ownershi...

[2] http://money.cnn.com/2012/11/30/technology/social/paul-cegli...

[3] http://www.americanlawyer.com/id=1202736579636/Where-in-the-...

I agree with you, but remember that Jeremy turned down the 4.5 before having a chance to consult with his lawyer. So he must have believed he had a significant chance of winning at that point, and his lawyer must now believe there is some chance of winning or he wouldn't take the case, but we don't know that the lawyer would have advised turning down the 4.5.

His beliefs may or may not conform to reality. I don't find it worthwhile to prejudge the cases based on my read of someone's actions. He's not required to act in a rational manner and the less rational a plaintiff's behavior, the more outlandish the claims may be (see also: Paul Ceglia).

So I'm going to stick with no opinion either way and wait for the hard evidence, rather than trying to read the behavior of people I don't know, who may or may not conform to my ideas of rational behavior, which is something we've yet to establish.

This is very important given that flat-out crazy parties (see also: SCO) have tied up the courts for, well, decades based on stuff and nonsense (and mostly the latter). As I can't prove whether plaintiff or defendant are rational until I see evidence, we're stuck with "stay neutral until you get the facts."

I've read plenty of cases and I've yet to see a case where prejudging the parties was a good idea. Contrarily, I've seen plenty of people get excited about nonsense that was laughed out of court later.

So no, there just isn't a good reason to rush to judgement on this or any other case. Whether the plaintiff or defendant is right is something we should wait to decide later, once we have a more complete set of facts.

Are you really both asserting that the mere fact someone is willing to litigate acts as evidence to the merit of their claims?

This is California. Frivolous lawsuits make up a meaningful portion of our GDP.

Certainly turning down a $4.5M settlement suggests you believe there's merit to your claims. Also, reputable lawyers won't take on a case they don't believe they have any chance of winning, and Keker & Van Nest appears to be a reputable firm. So not always, but in this case, basically yes. Admittedly there is a bit of a difference between "chance of winning" and "some merit" (unfortunately) though.

Even SCO hired reputable lawyers. Alas, it's generally the less rational plaintiffs where people give them entirely too much credit.

It's always better to wait for all the facts first. We have no reason to rush to judgement, nor is it a good idea. It simply makes one easier to manipulate, as the truth is most often the last thing to be heard. It's always easier to toss out a few quick lies than to painstakingly document the truth, especially in court.

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