Owed a billion dollars in Nvidia stock
colo.to
colo.to
The issue here is, IMHO, not "Nvidia owes me stock in an ironclad way and gets away with it because of statue of limitations", but "I accepted an offer from Nvidia but the paperwork between the offer and the options grant differed in a way that both benefits me, and nobody noticed or cared about until now".
The original offer was for 25k shares, vesting over 4 years.
The options paperwork says 25k shares, vesting over 4 _quarters_.
Now, I'm not a lawyer, and certainly not a securities lawyer, but that seems like it could be reasonably chalked down to a clerical error on the options paperwork? "You made a mistake and now I can get a billion dollars more than we agreed to originally" doesn't feel like a great lawsuit!
> Imagine my surprise: according to the duly signed option agreement, my options were meant to vest over four quarters, not four years, as both NVIDIA’s CFO and their outside counsel, Cooley, had asserted back in 1996.
On first reading it did give me pause because it's the first time "four years" is mentioned. But on another scan I agree it's cleverly written and never actually claims the agreement was four quarters, only that the paperwork says that.
Still it is a funny story, similar to those "I spent 20 Bitcoins on a pizza" ones, I guess.
Misreading. S/quarters/years/
On the other hand this could open precedent in other cases, current and future, so it's an understandable position not to offer to settle preemptively just for a display of good faith.
Since litigation is costly, the acceptable range for a settlement is centered around the expected outcome of a trial, plus or minus each party's cost of litigation (including opportunity cost).
In this case, "the claim is barred by the statute of limitations" implies that the expected outcome of litigation would be approximately $0. The net range for a settlement is then the 'nuisance value' of a lawsuit including any PR damage for airing the case publicly; that would be orders of magnitude below the $1bn claim.
What do you mean by this?
> Cost of litigation should be proportional to a reasonable settlement.
What you’re really saying is that attorneys’ fees should proportionate to claim size. But I don’t think that works. If I am bound and determined to take a dispute for a $3 refund all the way to the Supreme Court, why should me attorney be required to do all that work for $1 or whatever?
See one could think this is exceeding the role of the state, but this is not because these things are detrimental to trust which is required in the democratic state to facilitate economic transactions and employment contracts.
The offer letter, which spells out “which vests over 4 years”: https://colo.to/invitation.pdf
The option grant which has the accelerated schedule: https://colo.to/grant.pdf
The rulings are fact-specific, but clearly both parties here had a mutual understanding that the paper was only meant to reflect.
Same for contracts where the written language is absurd, and the agreement one party claims without the necessary evidence is way more reasonable, and the court finds in favor of the absurd contract.
As for sitting on it for 30 years. Lawyers are expensive - more than the cost to resolve the issue 30 years ago, but given the recent stock climb, it's now more than worth it.
I would have sued.
That'd be the thing to prove, and it's not as cut and dried when the documentation and one of the parties both say otherwise.
The world "smart contract" enthusiasts dream of.
The main idea is that in legal contracts, the written signed paper is just evidence for what the agreed-upon contract was. The actual contract is the agreement itself - which the paper may not reflect exactly. If the two parties disagree on what is the actual contract, the paper is of course strong evidence for one side or the other, but it's not the final word, other evidence may be brought that contradicts the written contract and that can be held to be more convincing.
In contrast, the smart contract crowd wants the contract code to represent the final word, and if any party didn't notice that the contract code didn't match the understanding they had of the agreement, too bad.
It's all nonsense. In the real world people make mistakes and a court should be allowed to override and figure out the right thing to do.
(In criminal law, "justice delayed is justice denied" and clarifications of constitutional or treaty requirements for speedy trials also can be tidied up by the legislature in a statute of limitations).
Statute (legislation) is a superior source of law to contract law, and so there is generally no way to contract to avoid being statute barred if a claim for breach of contract (or specific performance, etc.) is made beyond the statutory deadline.
Typically there are carve outs enacted in a statute of limitations that allow a claim to be brought out-of-time if the defendant has acted in a dishonest way that prevented a claim from being filed in time, for certain classes of litigant, or for certain types of claim. (And in criminal law, for certain offences - serious crimes will tend to have a longer, or no, limit on how long after the crime the prosecution is begun).
A statute of limitations typically does not extinguish defences based on the lapse of too much time; but such defences in some jurisdictions may be contracted away, leaving the statutory limit as the hard deadline.
There's this thing that people often do, even within the law itself, that's just like "well, you can fix everything by just writing it correctly the first time."
And this will always feel retroactively correct and never workable in practice.
Because, as I say repeatedly:
Smart contracts ARE NOT CONTRACTS. Count them in the worst named things in computing.
A contract is a legal agreement that is mostly about stipulations on what to do if things go wrong.
A so-called "smart contract" is doubly bad named -- because it's just a stupid, irrevocable, unchangeable, piece of code. Imagine an ATM with the controls welded shut.
He exercised the 15,625 options NVIDIA told him had vested. His claim now is that all 25,000 had actually vested, but NVIDIA’s letter gave him the wrong number. The letter was informing him of NVIDIA’s calculation; it did not change the option agreement. So the question is whether being given that incorrect information in 1996 gives him a claim today, despite both the exercise deadline and the statute of limitations having passed.
I disagree with this being a foregone conclusion
NVDA has also just announced they are buying back stock for 150b, so they could throw some the author's way, hehe.
If the author didn’t exercise his options, then the company would have redistributed the earmarked equity back into the common pool. This is a board-authorized % of equity put aside for stock awards.
If he had held on to those, they would be worth even more than the additional 9,375 shares he was entitled to -- about $1.7 billion using the same numbers in the post.
My guess is that he probably sold them when they were worth a lot less then they are now, and would have done the same with the additional shares too.
It's a bit the same as people making fun of someone buying a pizza with bitcoin, now worth a hundred thousand. It wasn't at the time, and most likely people would've sold it long before when it started to rise. And the hindsight should then be just as much "if you bought a pizza at the time in USD, why didn't you buy bitcoin instead??".
So to me one should get the latter of the two alternatives. People only come out of the woodwork because it suddenly happened to be worth a lot.
The guy that sold his Bitcoin for pizza, did multiple transactions (detailed in that forum thread), not one. Somehow this part is lost to history when the story gets told.
He liquidated tens of thousands of Bitcoins.
The tally is a lot closer to ~$4 billion at $82k per coin.
I'm not that upset because I know for a fact I would have cashed out at the obvious peak of about $30.
The one that does cause the occasional pang of remorse is the million or so dogecoin I gave away, as by the time I realised it was worth anything at all it was worth more than my house
I used to work in pharma with a chemist whose medicinal chem team had invented 3 different multi-billion-$ prescription drugs.
He told me ... no one gives a shit about your patents unless you start to make money. when that happens, your competitors suddenly remember that they invented your drug before you did.
He spent a considerable amount of time being deposed by lawyers from rival big-pharma companies.
Isn’t that the entire point of agreeing to be paid in options instead of salary?
but aside from that, a question I and many are wondering,
1.) is there a surefire guarantee that the case would be dismissed by court or that there is just a low chance of it being done.
Because if Nvidia knows this, then they are saying so sue us as a way to do just that (deterring you), but if the statute of limitations don't particularly apply though (as some have suggested here), then isn't litigation still a good path?
Also, instead of litigating with your own money, I imagine that there must be a market for cases like these who can litigate for you and win a portion of the money as well without requiring litigation fees from you. (A lot of hackernews comments are about this)
At best: you actually win money. At worst: you don't (but that's where you currently are), so perhaps there's still a reason to try.
IANAL and you have contacted top lawyers, (so please correct me if I am wrong as I usually am.)
2: how do you feel about the whole situation? I imagine not everyone has sort of even the possibility of becoming almost an billionaire. Also, do you believe that there could be other people like you as well where because of some technicality/(statute of limitations), they too didn't get the money/stocks?
3: What are the life lessons that you would like to give to the next generation?
It's still so impressive to me that I can just ask questions to you on hackernews just like that, thanks for taking the time to read it and have a nice day, kind sir!
Perhaps we can call it as a form of legal hygiene so as to impart the habit to the next generation. (Please feel free to correct me or tell me if there's a more proper term to what I am referring as, as well but I like the intuition/metaphor of treating it as hygiene.)
Thank you and have a nice day :-D
May I use your example if I give a talk at some point trying to impress upon the audience why they should actually read agreements before they sign them?
Different norms, perhaps.
They're clearly ok with the topic being discussed and shared.
Thank you for that simple wisdom for today.
No, at worst the court orders you to pay for the time spent by lawyers working for the company you sued. This option exists to nudge that calculation “it’s a million to one chance, but it might just work” away from filing lawsuits just for the hell of it.
Ok? So the author should have those shares to his name?
It's OK, dude. We've all been there. You're in good company with Masayoshi Son on this one.
Which of the possibilities is more likely is anyone’s guess.
Admitting the status of his original shares is not a good look either way. Either he sold, and the additional shares aren't technically worth $1B because he'd have sold them too. Otherwise he held, and is another unsatisfied greedy billionaire in the world.
It sounds like you were rather negligent as well. You didn't care to have any inkling of memory of the vesting schedule in 1996, or just to double check and "wrap up" the financial details of that agreement after the work was done?
It does seem somewhat suspect to elide mention of what became of the shares that you did own, and that you only re-noticed Nvidia in 2024. Every 14 year old PC nerd/gamer knew that name in 2001. It is quite a feat of negligence to wait that long to dig this up.
You seem like a decent person, and I do believe that you are justly owed something, but I must admit that I find this to be a depressing tale of rich people spinning wheels for naught. A modest inflation-adjusted multiple of the original value of the options seems reasonable.
Before anyone accuses me of shilling or white-knighting for a major corporation, I don't have any broader sympathy for them and I would generally take the side of David over Goliath, which I think some commenters are making this out to be, but it seems more like Mini-Goliath and Mega-Goliath are bikeshedding and David has no stake in the matter.
Then, you neglected this for ~30 years. It's fair to say that Nvidia doesn't owe you anything at this point.
But why? The OP (apparently) owns some of Nvidia. It seems reasonable to get that ownership recognised.
If someone has built a house on a remote lot you claim to own, while making property improvements and paying taxes, but you've never visited for 30 years; are you really entitled to swoop in and seize their house now?
If you are saying the physical house only and not the land that is different yes. Someone who can move the house obviously should still own the house. Trespassing usually doesn't invalidate ownership of all your belongings.
More important is the meta concept of like we write confusing contracts and then execute them and we agree on an end date (all transactions done) and then informally and implicitly we agree that if anything was wrong you only have z years after close date to fix it.
This is kind of thing where big people can do it themselves and other people perhaps need a regulated entity to review their docs ... Like mortgages and what not.
The interesting thing here would be if the IRS decides to have an opinion ...
Quod licet Iovi, non licet bovi
In the country i am, yes. If you have the paperwork.
Seasonal camping sites make sense, more from a 'our land' perspective.
And naturally any signed treaties should be honoured.
You may say "But, they were here first!", yet that's quite false. Native Americans invaded as well, either subsuming or slaughtering existing populations as they did so. Further, Native Americans warred, fought, killed each other, just as Europeans, Middle Easterners, and everyone else on the planet did. After all, human is human is human, and that's (sadly) what humans do.
And if you look at every other country on the planet, the precise same is true. Locals pushed aside as newcomers invaded, whether the UK, Scotland, Russia, Germany, the Middle East, literally every place on the planet.
There is no peoples, no country, no ethic group, which has not over time invaded another.
There is no one alive today, that does not stand on land once called 'home' by another.
You may wonder why I say this, but instead of discussing a land plot inside a Western country taken over by another citizen, you immediately dove into Native American rights and a Middle Eastern conflict for some inexplicable reason.
It is not "beyond weird." It is a well-defended position in contemporary political theory and it has had many prominent defenders for hundreds of years. For example, in the 1790s, Immanuel Kant wrote:
It can still be asked whether, when neither nature nor chance but just our own will brings us into the neighborhood of a people that holds out no prospect of a civil union with it, we should not be authorized to found colonies, by force if need be, in order to establish a civil union with them and bring these human beings (savages) into a rightful condition (as with the American Indians, the Hottentots and the inhabitants of New Holland); or (which is not much better), to found colonies by fraudulent purchase of their land, and so become owners of their land, making use of our superiority without regard for their first possession. Should we not be authorized to do this, especially since nature itself (which abhors a vacuum) seems to demand it, and great expanses of land in other parts of the world, which are now splendidly populated, would have otherwise remained uninhabited by civilized people or, indeed, would have to remain forever uninhabited, so that the end of creation would have been frustrated? But it is easy to see through this veil of injustice (Jesuitism), which would sanction any means to good ends. Such a way of acquiring land is therefore to be repudiated.
Note that I said seasonal camping sites make sense. And I said treaties make sense. I simply said 'wandering about' doesn't convey ownership, aka 'possession'. To take such a notion to the extreme, imagine a grouping of 4 who rove all around the entirety of Canada and the US through their lifetime. You could easily do this over 20 to 30 years. Should those 4 be attributed possession? As owners of that entire landmass via treaty, or just prevent any use of that land by anyone else?
Absurd. And it is equally absurd that land used for travel between two campsites, basically as a road, should mysteriously convey ownership/possession too.
For example, typically there were winter and summer camp sites in the US. Yet when not doing so, Natives would often 'rove' from one of the other, think 'migration'. Yet I've seen ridiculous assertions that someone basically using the land as a road between two campsites, to conveys ownership. Sheer nonsense.
I don't find Kant's position at all convincing, mostly because the two parties' understandings of the concept of "ownership" were not mutually intelligible (possession vs usufruction). However, the quote does have relevance to your post.
However no view exists in a vacuum, and I will indelibly view my example of a group of 4 as a valid statement, about the absurdities of 'walked on the land once in my life, to get to my summer/winter home', compared to some claims of a tribe of a few hundred people, somehow owning hundreds of millions of acres of land, just cause they walked on tiny parts of it to get to their seasonal homes.
So no, I don't see the relevance, because I'm not discussing the concepts therein directly.
Of course, the land in question was effectively open forest/plains, isolated with no cities and almost no one living on or around it. And if it remained as so, by todays standards, would be worth often dollars per acre. Meanwhile, we're attributing dollar amounts to land which only became valuable, because it was developed by some means.
While I am not directly answering your question, I frankly find the 'cut off' period to be quite weird. Everyone on the planet has ancestors which have been displaced, AND have displaced peoples. We're both the conquerors and the conquered. For example, I have Scottish heritage. Where's the payment for the land the English stole from my ancestors? And for the English, where's the payment that the Romans owe, for the land taken from those in the isles 2k years ago? Or the French owe, when they invaded and hung out for a while?
Individuals were displaced, entire groupings of people slaughter or literally decimated.
It goes on and on and on, back through time, all owing all. Yet that is completely ignored, including endless land grabs all over the planet even over the last 2 centuries, but... oh well, significant compensation and land returns are only really given to those in North America.
I believe in fairness. And to me, this seems... off somehow.
The statute of limitations regime exists to provide stability. If you are harmed, you have some amount of time to make a claim.
Doing away with the statute of limitations would result in more injustice, not less.
Give the guy a break. It was a check of 700 bucks for exercising shares in a small (at the time) company that was not even public. Most people would probably not notice the error in the 1 year vs 4 year exercise schedule. Especially because 4 years is the standard, so that seems rather normal to agree to that even though it was an error and differing from the original offer.
I'm not mathemagician, but a tiny fraction of a billion with a b dollars is worth filing.
If nothing else it gives us all an exciting news cycle.
In this case a 1% chance of $1bn represents an expected value of $10m. If you accept the cost of litigation as $10m (for example), then your expected value is actually zero. And if you think about the outcomes of the 99% of cases, bankruptcy is hugely painful.
One can always play silly games with expected value. If the "value" of a human life is $10m (supposedly a figure used by some governments), you could pose all sorts of expected value scenarios, but when it's your life that all goes out of the window.
This case has a 0% chance of anything because of the statute of limitations and no legitimate claim that would allow for decades-long tolling. He'd file suit, NVIDIA would file a motion to dismiss, the court would probably give him one chance to amend (to make an argument about tolling) and then it would be dismissed with prejudice.
If the full agreement had a prevailing-party attorney fee clause, this guy could end up paying NVIDIA's legal fees.
Is that not covered on contingency?
You could still sue Nvidia for compensation, assuming no statue of limitations, but the thing you can be compensated for is a completely different thing. You can still be compensated the value of the option. I.e. the difference between the strike price and the market price 30 years ago. That's the thing you can sue for. You cannot retroactively extend the option because longer duration options have a higher premium so you would be telling Nvidia to pay you more money than they contractually obligated themselves.
It's beside the point whether he's a lawyer. He's not your lawyer, that's for sure. The "no medical nor legal advice but otherwise you can advise anything" idea is beyond stupid.
Judge advice on its merit, not by what category it's in.
This is not an absolute fact.
It depends entirely on the commenter's jurisdiction.
Which jurisdiction? Under what circumstances? Who enforces these purported rules?
I don't need to ask whether you're a lawyer, you're simply out of your depth I'm afraid.
Even if they'd only put a fraction of it into MSFT and held it until only 2003 or 2004 it would have been far more than enough to retire on comfortably.
But no one listens to a 7 year old about investments! (Nor should they in most cases, i think i told her to buy more yahoo too)
I dont know how much they held or how much they sold, or if they even sold at all, just a fun memory triggered by your comment:)
It was sufficiently mass market and popular that it was everywhere in Pacific Northwest (Portland to the Canadian border region) television and print media. It was enough of a cultural phenomenon that I remember seeing media coverage of people who lined up outside the retail boxed software store at midnight to purchase it.
You never know, in another universe it could have still ended up as nothing.
Gonna listen to my kid when she’s 14, too, as it’s been a strategy that has paid off to date.
And then put the rest into Apple stock. I told him he was absolutely insane.
He sold about a quarter of it at some point in 2018, but is currently sitting on several million dollars of gain.
"This will never work as a currency, because of the max number of bitcoins it will inherently be deflationary, and the value will go up, which means that there will be a disincentive to spend it, because the value will just go up..."
Yep... Did not buy any.
https://news.ycombinator.com/item?id=1943699
https://news.ycombinator.com/item?id=2060609
when they were valued around $0.30 each, or about $4 of Bitcoin then for $1M now.
Since then I've heavily revised my thinking. Primarily that I don't dismiss things as easily anymore. I try to focus on coming up with a reason to like it instead of disliking it.
I never sold.
You're almost certainly either misrepresenting or misunderstanding what your attorneys told you.
You would never get to discovery with your complaint. If you sued, NVIDIA would win a motion to dismiss in federal court based on your claim being time-barred.
You have no basis to support decades-long tolling. The possibility that, say, NVIDIA knew what it told you was wrong 30 years ago is not good enough under federal pleading standards to get you to discovery. You would need sufficient evidence to support a claim that NVIDIA intentionally lied, which you obviously don't have otherwise you would have mentioned it in your post.
State court (California) has a few wrinkles but the result ends up being the same.
Basically the legal system is designed to prevent fishing expeditions on decades-old claims. You cannot have possession of an agreement and then run to the courts asking for a billion dollars because you failed for three decades to read it carefully.
If you are past the statute of limitations, the bar is intentionally virtually impossibly high.
Would even an intentional lie act to to reset the limitation period here? The hypothetical lie wasn't a deep secret exposed by some whistleblower, it came to light by... reading the vesting agreement. Since AFAIK limitation periods run from "know or ought to have known," I can't see a viable construction to keep the dispute live after 30 years.
But here's a hypothetical situation (unrealistic) that could change things. Let's say he came into possession of an internal document showing that someone at NVIDIA knew the grant said one year and chose to state 4 years to him anyway. Now he has an argument for fraud, and in California, the statute of limitations for fraud is 3 years from the date when you discover the fraud.
This type of thing could get him past a motion to dismiss provided that he brings the action within the 3 years after discovering the evidence of fraud. But nothing in the post claims this type of evidence. It just seems like a mistake was made and the guy, not knowing what NVIDIA would become, didn't even bother to check the documents he had at the time.
Cool story for the bar or grandkids.
From the looks of it, this firm primarily works on contingency, so it's not like they were doing anything out of the ordinary. They took a flyer on his "case" on the off chance that some correspondence might lead NVIDIA to throw a few bucks at this guy.
For what it’s worth, I just view it as part of the lottery of life. You win some, you lose some, you learn plenty.
Are you back in Sausalito now for good?
I hope NVIDIA's lawyers are reading this comment and filing a state bar complaint against your attorneys.
It would be different if they thought their claim had no merit, or were hiding evidence that it was a fraudulent claim. But here, it seems like it's just a slightly long-shot due to the timing. AFAICT there's no problem in pursuing claims like that, either for the client or the attorney.
If Nvidia showed you contract paperwork that proved they overpaid you 9,375 shares in 1993, would you agree to pay them back the present value? After all contracts should be enforceable indefinitely right?
there should be "expiration", after all he didn't doing anything for 30 years
Imagine if Nvidia is not as big today, he wouldn't bother to make a claim
I had a similar experience although over a shorter time horizon. I was in a dispute with a corporation which prompted me to pore over every word in every previously signed agreement. I discovered, due to an obvious typo in a stock option agreement, more options had vested than had been intended. After some pushback, they eventually relented and awarded me the options.
Given the amount of money involved, it was worth engaging lawyers to see if NVIDIA would pay you some money to save the hassle of dealing with it, but there is and was zero prospect of this ever being awarded in your favor by a court since the options expired.
They exercised 15,625 options of the 25,000. The OP sent $781.25 to NVIDIA. The remaining 9,375 options were not exercised, they expired 90 days after April 16th 1996.
Only in hindsight, 30 years later, has the OP realized that the other 9,375 had vested due to ambiguous wording in the agreement. The article is about the 9,375 that were not exercised.
I think this is a typo.
While no one's hands might be clean in this, at the end of the day the party with the resources and expertise is equipped differently.
It might not hurt to get some more opinions even if they end up in the same place.
Putting aside the fact that any claims here are almost certainly time barred after 30 years, ostensibly, your attorney explained to you that because you had the grant in your possession, claiming that you reasonably relied on the company's statement about what the grant said would weigh heavily against any misrepresentation or fraud causes of action in a lawsuit.
Might as well sue.
The last time someone decided that an option shouldn't expire got us inflation, unemployment, inequality and a debt crisis.
Good thing that we stopped right???
Looks at the funding rate of his options in his wallet that he uses to buy things at the supermarket. Still no funding rate in sight.
If you wouldn't mind reviewing https://news.ycombinator.com/newsguidelines.html and taking the intended spirit of the site more to heart, we'd be grateful.
We don't need you to love capitalism (or billionaires), we just need you to stop posting low-effort flamebait comments like this one (or https://news.ycombinator.com/item?id=49840585). You may not owe capitalism or billionaires better, but you owe this community better if you're participating in it.
Unless of course the op sold the 15k shares he did get years ago.
I wish that was the usual situation
Somebody did the paperwork wrong, but paperwork isn't the agreement. You agreed what you agreed, thought everything was in order, and then discovered an error in the documents.
It doesn't seem like there's a claim here.
https://time.com/archive/6735546/hes-the-master-of-his-domai...
It is a very interesting read, and I can only recommend it. Some of it is one sentence after another that left me astonished.
In another case I was paid out and my options supposedly terminated when a company I worked for was acquired by Splunk. The startup had used Carta to manage the options and nobody terminated the agreements in Carta and I kept vesting. The joke was I was going to wait to fully vest and then ask them to convert to Splunk stock. Someone eventually noticed and they revoked all agreements in the system. I still wonder how that would have played out legally, but I also wasn't interested in double dipping.
You're intentionally trying to muddle the waters here by arguing along two different axis.
1. the contract granting options has a delivery period (in your words "expiry period")
2. the options themselves have a duration (aka expiry period)
When you are saying "Unless the options grant had specific language of an expiry period" you are only talking about the delivery period of the options. Aka when the options become available. So you are not complaining about late delivery, you're complaining about lack of delivery.
When you are saying "I would gather there's a very good chance of a large payout." you are intentionally confusing (1.) with (2.). The delivered options have a value on the open market and that value was not delivered. Hence there is a contradiction. You're saying "large payout" but the options are only worth a fraction of the shares at the time the issues vested. You do not get to simulate the most optimal future that you would have exercised the options and held them for thirty years, you have to prove that yourself and the best time to prove that was 27 years ago aka within the statue of limitations. Now that 30 years passed, you have to argue that you would have held the options all the way until today and exercised them today, but the grant only covers the option premium at the time of the grant, not the option premium of a 30 year long option. So Nvidia can still give you your options but the options would give you the exact same duration as the options back then and you would get exactly the same premium on them.
Basically you could make Nvidia the offer to settle for the value of the options so that you stay quiet and don't sue them, that's what your lawyers can get out of that contract.
Edit: Correction with regards to how big the payout can be, can be found here https://news.ycombinator.com/item?id=49874789
You're intentionally making this far more complicated than my original statement along countless axes.
> Breach of a written contract: 4 years from the date the contract was broken.
Which part do you think is debatable?
> Sometimes, if the problem (like the injury or damage) was not discovered right away, the statute of limitations generally starts counting from the date the problem was discovered or should reasonably have been discovered, whichever comes first.
Or he sold them years ago for far less than they are worth now, in which case he could have a claim for the original shares which were worth a few k after interest.
Firms can be sanctioned for pursuing cases knowing the statute of limitations has expired.
That was my first thought as well.
Source: cannabis and Law&Order reruns.
What OP has here is a license to go on a fishing expedition through NVIDIA.
1. Time barring is pretty iron clad. Sucks for the author but consider the alternative where anyone could sue anyone after any period of time.
2. If a court did find in favor of the plaintiff, the court would be more likely to award the 90s cash value of the stock, plus interest, rather than awarding the shares or current market value (damages being how he was actually wronged in the 90s rather than speculating what he might have done with the stock to present)
3. Given 1 and 2, Nvidia is unlikely to make a big settlement, meaning an expensive and risky trial.
Which brings us to hidden reason #4: nobody would pay that much for the rights so it probably isn't worth the author's time. He'd still be the man at the center of the suit: depositions, testimony, cross examination, records subpoenas...
What's the problem with this alternative, exactly? Some crimes already have no statute of limitations, and this hasn't caused the sky to fall.
It is inherently unfair and destabilizing if people can sit on alleged wrongs, violations of agreements, etc. indefinitely, either intentionally or because they were ignorant or negligent, and then raise those wrongs in the court system any time they choose to.
A statute of limitations basically says "take your rights and obligations seriously and when you have a dispute over them with another party, raise it in a reasonable amount of time or forever hold your peace".
2. Most people draw a line where it seems needlessly cruel to prosecute an old crime; an extreme example, should a middle-aged person with decades of good behavior live in fear of being prosecuted for a relatively small crime committed as a teenager? Conversely, if a person commits a crime as a teenager, shouldn't they have clemency if they stop committing crimes for a long time and become a good citizen? Most people prefer the outcome that people can put smaller mistakes behind them; they may debate where to draw the lines, of course.
- If you wait too long to pursue a case, then the reliability of evidence goes down, as people lose older records, memories fail, physical infrastructure is replaced, etc.
- Statutes of limitations diminish the ability of malicious accusers to pursue cases against their targets.
- Statutes of limitations also create a sense of finality to a situation; it prevents people from coming out of the woodwork to unsettle something settled 20 years ago.
- In general, the clock runs from when you first find out about an injury to when you can first take action do something about it. That action isn't necessarily to actually file a lawsuit; there are often many things you can do to pause or reset the clock before filing the lawsuit.
- They also incentivize people to pursue redress sooner rather than later, with the concomitant benefits of doing so.
- If it takes you, say, five years to figure out that you are really mad about being injured by somebody... why were you fine with it for five years? It really undercuts your argument about the seriousness of the injury to delay for so long.
Let's say those options were worth $0.25 back then, Nvidia would have to issue an option with a strike price of $224.72 at a share price of $225.07 and the same duration to honor the contract. They could also set the issue date and duration to be the IPO day and the strike price the IPO share price, but then the premium difference would have to compensate the gap between the IPO price and the current price and you'd have to pay that premium difference out of pocket to simulate the fact that you kept holding an option, then let it expire and kept paying the premium to buy new options to extend it.
Edit: I didn't read the letter when I wrote this so my numbers are off. He might be owed $100k+ worth of options if the strike price was $0.05 and the share price was $12. I apologize for wrong numbers, but the general concept should stay valid.
The title is misleading, they don’t owe him.
The story is NVIDIA made a mistake and OP tried to exploit it and failed and is now grabbing another straw with that post.
It was not intentional shares to his or Nvidia’s understanding.
Everybody reading the actual story would not just upvote this.
The upvotes must be simple big corp hate +misleading title
Eceryone everywhere appears to hate statuses of limitations, but they exist for a reason, namely that after some time society needs to move on. It may be disappointing, or even cruel, for the victims, but we can't keep litigating the past forever.
Espescially so in the "land of the free" which is the land of lawyers and lawsuits.
It's worth pointing out this reasoning is usually considered self-evident. I've rarely seen anyone doing any kind of deepdive into a practical reason for this.
At least between adults though, such statutes do appear to overwhelmingly protect the holders of power/wealth/etc. from relinquishing said power/wealth/etc. It's hard to see broad societal benefits of statutes that are diametrically opposed to the interests of victims in all common cases.
People are not expected to hold onto there documents forever, humans forget.. and change
Figuring out what happened 3 years ago is hard, figuring out what happened 30 years ago is near impossible & often wrong
If this were the case, litigating these instances would simply end quickly due to lack of evidence. There would be no cause for such a statute in such cases.
Your comment strikes me like you never had any lawsuits?
That is, btw, a thing that is already happening.
One example is people leaving the church, the state deleting the evidence after 10 years, and the church asking for it after 11
Worse, the ruling required voluntary action from all title holders on an island, which of course was not taken.
At this point, all of the original litigants and judges are dead, and many of the descendants involved in 1991 are dead too. Every generation that passes expands the number of people who have a stake through inheritance.
In this case it's not as simple as a statute of limitations because land ultimately has to be titled, but these are some of the types of issues you run into if you don't have a time limit on things. People die. Papers get lost or destroyed. Organizations disband or get sold.
It's just better not to allow the complexity to overwhelm the legal system.
The first is effectively a waste of time, the second a messy descent into hell on all sides.
Certainly messy & certainly hellish for some. For "all sides" though? I guess maybe if we're counting the fact it would paint a large target on the back of any beneficiaries.
Moving away from native title, there are also many "peppercorn leases" bequeathed to various cities about the globe - large parks carved out from once larger farming estates, now fully urbanised and embedded within a sea of million dollar lots and apartments.
Should anyone sue over the park land no longer being a pure park (for example) or for petty reasons of "peppercorn" rent not being paid (ie violation of the terms of the gift to the city), the park would be returned to the rightful descendants .. an army of (say) fourth and fifth generation offspring all at odds for recognition and weighting and a piece of very valuable real estate.
I think you argue for why don't you let the case be opened and then dismiss it in case there's not enough evidence available. On one level that's not great because it results in a lot of cases opened and then closed for lack of evidence. On another, it's not great because there's significant unfairness when some of these cases are pursuable and some are not --- drawing a line in the sand and giving a specific time frame for things to happen or not seems more fair to me, but I guess it's debatable.
Having unlimited time to litigate also suggests everyone should retain all records forever. That's a very high burden. A statute of limitations of say 3 years for contracts means I can discard old records at my own discretion without worrying that it may result in future liability.
Personally, I have some debts for services rendered where despite my desire and ability to pay, I've been unable to reach the service provider and pay them. I've also got some similar age debts where I certainly did pay them, but I've lost records of payment and it's been long enough that I might not be assured that I did pay them... sometimes things slip through the cracks. A statute of limitations means that my estate (and therefore my heirs) don't have to pay back the heirs of said service providers when they look through records and don't find evidence of payment.
Somewhat randomly chosen reference:
https://www.richardnelsonllp.co.uk/guides/statute-of-limitat...
Nobody has made this claim.
Well quoted.
When someone dismisses your interpretation it serves to understand it well.
Additionally: A contractual mistake would likely not return specific performance (stock) unless special conditions were met.
For example: a company makes a stock mistake, you observe that at the time it happens, but then do nothing until you see the stock increase in value. Company could assert you _were_ due the stock but the value of that stock is determined by the time-of-breach and they return you $.
Unless you had a substantial claim to voting interest would probably be monetary reward!
NYL
I don't. I blame on the ADHD. Or maybe its laziness.
people will go to _amazing_ lengths not to read something new or unfamiliar. That feeling of "i must be dumb" is most often the reason people avoid it, and is just the normal part of learning something new.
I put all received documents, including mega-page bank contracts into chatgpt (etc) to ask questions about the contract. My bank hates me - I ask the awkward questions. Like "what disadvantages does this contract hold for me? Once again they unilaterally changed the contract(!) - what has been added and taken away? Etc.
Why would an American working in software in the mid 90s expatriate to Tonga, a tiny island nation, population ~100k, virtually no tech industry, with little or no internet back then? (assuming Eric is American).
Maybe a govt IT contract, but it sounds at odds to "working on various internet startup schemes".
(Retract the cheating dig if not applicable. Make it in the first place b/c I’m bummed when folks who make their money thanks to a country’s infra, laws, etc. don’t pay their fair share, at least in those cases when there’s so much you can even give back half and have immense riches.)
Normally this is a right to buy at a given price. If he was billed for it, then there is very little chance NVIDIA can weasel they way out ot it. I suspect he never paid for the shares.
You’re not the only one who want to see this go somewhere.
1. OP was granted 25,000 options.
2. OP was told by Nvidia their options had vested and they need to exercise. OP said ok, I’ll exercise.
3. Nvidia made an error in stating the number of options (although the paperwork had the correct number), so only a portion were exercised.
4. The remaining options expired as they were not exercised.
So the legal argument is that Nvidia’s error in stating the number of options resulted in OP’s loss. However lawyers have told OP the statue of limitation on such a civil suit have passed thus no point in pursuing it.
Is that it?
It's a fun story, but that's all. There's absolutely no legal case here.
1) The author received communication 30 years ago that he had 15,625 stock options available to exercise;
2) However, according to some paperwork he had, he believes now that he actually had 25,000 stock options vested
The problem is, if we accept this as true (and it sounds like the paperwork had conflicting info about the vesting, and that the part that suggested the 25,000 vested might have been an error, so this part is not at all clear), all it means is that the author owned some additional stock options 30 years ago which he failed to exercise. These options have long since expired and so would be worthless today.
The author is claiming that the communication he received was misrepresentation, but if so the statue of limitations has long since expired.
I think a lot of the commenters are conflating stock options with actual shares themselves (which surprises me given the nature of this place, but regardless). If we were talking about 15,625 vs 25,000 shares then it's a different story since shares don't expire and don't need to be exercised. He would still have a claim to the extra shares--the claim would be that he had owned them this whole time. But options are a different story because of expiration.
I think the author caused that misunderstanding by talking about the value of the shares and not the payment he could have made to exercise his options.
I can also see why these claims age out; else all old companies would have enough uncertainty they would be uninvestable.
Could they successfully argue that he would have sold the shares immediately so they only owe him cash value plus modest interest?
I’m not a lawyer, though, maybe it’s not relevant.
I think the other reason claims age out is that a lot of potential evidence like witness testimony, documents, etc, goes away.
The author would have sold the shares before Nvidia stock skyrocketed even if he had received them. So, the actual loss might not be as large as a billion dollars in reality.
This is why I still love California so much. The chance of things like this is just much higher than in any other place on Earth.
https://www.stuff.co.nz/life-style/homed/latest/132554070/am...
Every 1% expected value would put it at $10 million dollars.
Still massively sucks though. Not quite as bad as the guy who bought two pizzas for 10,000 bitcoin but still a situation that would be impossible to ever get over.
> Then, in April 1996 - by which time I’d expatriated to the Kingdom of Tonga and was working on various internet startup schemes
He must have so many interesting stories!
Was this part of the agreement since the beginning or did they add this afterwards, and if so did they clearly communicate to you?
Here's a question though - you were given 15,625, so are you a billionare? Do you have those shares? Probably not. So what's makes you think that if you'd got those extra 9k shares you would've kept them?
It's the same as the Bitcoin millionaires, yes, you had 50 bitcoin in 2012 you'd be rich now. But the vast majority of those people sold their bitcoin long before it went up (or bought a pizza with it) and a big chunk of those who didn't got Mt Goxed or BitFinxed or FTX'ed, or got hacked, or lost their hard disk with their private keys etc. etc. etc.
Where did it come from? Well, I was curious how Bitcoin worked, so I set up a little mining rig and let it run at night on my work computer. So, other than my time, which I think I did on work's time, and the power, which I think I used work's power... I saw it as a free cup of coffee.
Honestly, I was just so happy to find a booth at a convention that actually took Bitcoin that I didn't mind the crappy exchange rate.
But anyway, I don't think regret is a particularly useful thing to hold onto. You can regret things you did, and you can regret things you didn't do. Either way, there's nothing you can do about it. It feels like baggage. Hold on to too much of it and you sink. You have to find a way to rise above it and keep moving forward. If you don't, you'll drown.
I say that as someone who learned this lesson the hard way.
I spent 3+ years in a legal battle with an insurance company and their contractor that ultimately cost me more than $500,000. I was right. Period. I had been wronged. Period. The contractor and insurance company both lied and I had ample documentation of them doing so, and doing shoddy work. What I was asking for was completely reasonable. But who cares? That's not how the courts or the legal system work.
What I learned from the process was that most people just get screwed over when they go up against big companies. And it's not even close. I'd guess something like 75% of people who get into a fight with an insurance company end up losing -- and it's probably higher than that if you factor in the people who simply give up. Eventually, you have to decide whether continuing to fight is worth what it's costing you.
There will always be another "I almost caught the fish!" story to tell. Life is long. Learn from the mistakes, let go of the things you can't change, and do your best to keep moving forward.
Some situations just suck. Best not to think about it them too much.
It seems like both you didn't caring about it during vesting or maybe they did a typo since it seems like you were vested over 4 years normally and the offer is over 4 years?
Anyway if someone did this to me this is pretty much grounds for an irreparable relationship. Though I guess it was worth the attempt for $1b.
If someone tried to claim what was contractually theirs?
Of course, contracts are legally binding, but that's completely different from my perception / evaluation of someone - if the mutual understanding was over 4 years and then 30 years later you find the typo and come back to bite me then yes it is 100% an irreparable relationship.
Yes I would think better of them if they came back to bite if NVIDIA was a penny stock but probably nobody would bite them back if they found out it was worth $100 instead of $1B.
To be clear, the grant is the legally binding document regardless of intent (initial offer + vesting seems to imply 4 years), I would eat the typo if it was 30 years ago and chalk it off as a learned mistake (assuming it wasn't company altering), although I would still think less of them for fleecing.
There’s also situations like this where mistakes can be ignored.
Otherwise you could have really bad situations where both parties are forced into a stupid contract that doesn’t make sense, or someone is forced to sell their house for £1.000000 rather than £1,000,000.
Legally, the grant contract is the "Casus belli" - it is the reason for which you have a claim to something, whether it was intent or not doesn't matter, you have a valid claim to take them to court, there is no need to really talk about that. However it gets resolved, is really not something I can tell, not a lawyer.
Whether I remain friends or on trustworthy terms is a personal matter, which is unrelated to legal outcomes in this case.
A bit of cash can turn folks into awful people, and some contracts are just a obfuscated legal con of the naive. =3
I'm just differentiating between the legal correctness and personal opinion/viewpoints on the matter.
Regardless of whether you are legally correct or not isn't really the crux of the issue for me, heck maybe Jensen doesn't even care about a billion given everything's he's minting (who knows though).
I was only talking from personal standing, in your stated cases or if I was in this position (I made some assumptions regarding the case), it would be a breaches of good faith and I would find it hard to trust them in a partnership ever again.
Only my POV, maybe the folks at the B level don't care about this as much since they are starting to fling Ts around. I can see how some people wouldn't really care, i.e. treating them as a freelancer and main objective is getting something done, but on a personal basis probably wouldn't trust them (say on personal matters that are company defining).
The author should sue Nvidia & try to at least force a settlement. What the F are these lawyers doing? When a billion bucks is what you're trying to legitimately claim, the unpredictability of a trial is going to get them to toss you some millions, which is pocket change to Nvidia. At least go get those millions.
It is possible it doesn't work out, but jeez, I'd definitely take the next step. Go consult some more creative lawyers.
Six years later after filing the equivalent of a FOIA I realized something didn’t add up. I filed for judicial review, it was denied on prescription grounds (delay) so the court had no need to examine the case on its merits. I appealed, the judgment held.
So yeah, delay/prescription is a real and super serious thing, especially in administrative law. Very strict.
I don't have any inside info about this case obviously, but it's clear Nvidia would have ample motive to try to claw back whatever they could as mid 1996 was when they made their pivot after the disaster.
Again, not throwing around accusations here, just saying it may not be as cut and dried as "it was just an oops but everyone forgot about it for 30 years."
It annoys me every time I read the word expat and its derivatives. You became an immigrant, by emigrating to the Kingdom of Tonga. Only because you are white and rich doesn't change the concept of emigration to warrant a word with less stigma.
Immigration is a tricky subject with many nuances, pretending otherwise i.e. driving the immigration = bad line and calling immigration that affects ourselves or that we don't find objectionable expatriation is disingenuous and hinders good quality discourse about the topic.
"Goodbye, USA friend, I am emigrating to Tonga so I won't see you again."
"Hello my new Tongan neighbor! I am an immigrant to your beautiful country."
"Hey, buddies at my high school reunion, I'm doing great thanks! I am an expat living in Tonga these days."
"Emigrant" exists but almost unused (perhaps other than in specialist policy writing.) "Expat" is the common agent noun for "Emigrate."
Since I don't want to derail the discussion I'll leave it at this and here this food for thought if you haven't confronted the topic give it a chance. A compelling definition of privilege is "Not having to think about X". Not having to think about the price of groceries is or more clearly the inverse of having to is symptomatic of poverty. Similarly, not having to think about one's skin color is a form of privilege. That's why many find it offensive to bring up, because normally they aren't confronted with it. How many times did we get suspicious looks because we are white? s/white/black and hopefully you see the point.
I learned a long time ago that everyone has a story of missed mega-riches in Silicon Valley. I have a few of my own :-)
Great story, thanks for sharing.
Did anything progress past tech demos?
I’m in a small game dev group and I very much enjoy seeing how older engineers tackle problems.
I hope to have such a retirement, although my interest is primarily in video games.
I dream of making high quality games that you buy once, and after a bit I’d open source everything. I’d also love to hire a small team, I’d probably move to a cheaper country though.
Unfortunately the game industry is a horrible business if you need to make an income though.
I don't know your situation in life, but if your experience is anything like mine I reckon you've probably made the right decision.
You were lucky, as most university contracts clearly state they own all associated IP created while working on campus. They could have legally given you $0, and end of employment notice. These things can get messy fast. =3
Yep. I was on a fixed term contract, which had expired, even though I was still working on the project well after its expiration. It would have been interesting to argue that any IP assignment expired with the contract. As you said: messy. As I judged: not worth it.
Any chance it was THE Vallejo where Alan Watts lived, and the grateful dead once played? Or maybe she was just named in homage?
Either way, it's very cool! Thanks for the great read.
I imagine that living in a place with that sort of history was the kind of experience one can't really convey in a few words online, but if you have written about it (or intend to) I would certainly love to read more.
I'm familiar enough with the history, but I really have to wonder why quads were pursued. It seems like even at the time, triangles were the obvious long-term bet. Of course it's never quite that obvious at the time, but nevertheless quads seem like one of those weird tech offshoots that are simply too different to ever get traction, like ternary arithmetic. And the trajectory of transistor counts was such that per-pixel division for perfect perspective correctness was simply inevitable.
So the dispute is basically over whether NVIDIA incorrectly prevented a guy from buying $468.75 worth of additional founder-era stock, which through NVIDIA's subsequent growth and splits became approximately $1 billion of stock thirty years later.
OP was not given all of the shares earned at the time decades ago and didn't realize that they should've been payed out, but after engaging in a lawsuit realized that the court would likely not grant the case give the statute of limitations.
Kinda like all the Sony game 'owners' not carefully reasing the legally binding contracts they're always signing realizing that they are not in fact purchasing a gauranteed lifetime access to the game.
Whether they "earned" them is disputable — the offer letter specifies one vesting schedule (25% every year), the "cover sheet" from the options agreement specifies other (25% every _quarter_).
So — the OP got the shares he was promised in the original offer letter; but later discovered that some of the documents he later got implied that the vesting schedule should be accelerated compared to what he agreed to.
I think that is probably the funniest way possible to earn a billion dollars; but whether he's "owed" that money/shares, is... up for a debate.
Now, 25 years later the author is preparing a litigation.
2. He didn’t “forget” — he misunderstood his contract, and only caught the error much later.
3. He’s not looking for pity. He writes: “I offer this in the spirit of a cautionary tale. I remain sanguine, and amused.”
Maybe something about his story bothered you?
it isnt false and you would know that if you read the article. Please dont comment on HN without reading the article....
Almost as if people here go an extra length to be shit eating morons.
I think it is pretty much agreed that the OP has a perfectly good claim starting a legal event. Whether it amounts to the 1B settlement or not is not something anyone here can decide.
These matters are not purely legal nor purely right and wrong.
They are personal and political too.
This is a fight you should have fought.
Just my 2c and how I think about business. I get it's not the American Way™ but maybe it should be.
No company can just settle with every person who decides to litigate them, especially ones that are seen as large targets who can afford to pay.
The statute of limitations is there to keep the process fair, because that defendant can spend decades discarding or losing old documents and exonerating pieces of evidence, witnesses can die or forget events in the past, etc.
And if both parties intended for it to be vesting over four years and you both acted in line with that intention, then the written contract has been superseded by your actions.
Eg You’ve worked there for 10 years, the contract you signed says you get paid 100k but you’ve both since sent letters agreeing to 150k and they’ve been paying you 150k the whole time. Would you accept them taking back 500k because of the original contract? Of course not, because you’ve both agreed to accept the new terms through your actions.