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Los Angeles – Several recently departed employees of Hyperloop One – including co-founder Brogan BamBrogan – have filed an explosive lawsuit against the company just weeks after resigning.
Court documents filed this week accuse the company’s board of misusing funds; breach of contract; threatening physical harm, and using the company to “augment their personal brands, enhance their romantic lives, and line their pockets (and those of their family members)”.
Alongside BamBrogan – whom Hyperloop One had previously stated resigned “for personal reasons” – the court case lists three further former Hyperloop employees as plaintiffs namely Knut Saer, David Prendergast, and William Mulholland.
Among the accusations: that co-founder Shervin Pishevar increased the salary of a PR contractor with whom he was in a relationship from $15,000 to $40,000 per month; pressured investors to also invest in Sherpa Ventures, Pishevar’s VC fund, in order to invest in Hyperloop One; and used the company’s headquarters “as their own private party venue”.
The most remarkable claim is that Pishevar hired his brother, Afshin Pishevar, as a lawyer for the firm. When BamBrogan refused to attend a meeting with Russian investors and disclosed some of the other allegations within the suit to those investors, the document alleges, Afshin retaliated by leaving “a hangman’s noose” on BamBrogan’s desk. The document contains what are allegedly CCTV images of Pishevar holding the noose, and another of BamBrogan holding it to camera.
[/i] Buzzfeed News reported earlier that BamBrogan has filed a restraining order against Afshin Pishevar.
When the employees issued a letter of complaint, BamBrogan alleges, the company warned “if anyone talked to investors about what was happening in the company, Hyperloop One would “come after” them; if they did not toe the line, this would be the “worst day” of their lives; and they would bleed the employees dry with frivolous lawsuits”.
In a statement, Orin Snyder, a lawyer acting on behalf of Hyperloop One, told WIRED: “Today’s lawsuit brought by former employees of Hyperloop One is unfortunate and delusional. These employees tried to stage a coup and failed. They knew that the company was aware of their actions, and this lawsuit is their preemptive strike. The claims are pure nonsense and will be met with a swift and potent legal response.”
To which Justin Berger of Cotchett, Pitre & McCarthy, LLP, the plaintiff’s attorney, responded: “The company’s statement is long on rhetoric and short on facts. The company’s spin is belied by the facts and the chronology of events, as laid out in great detail in the Complaint. Plaintiffs and seven other top employees quietly approached the Defendants in May with reasonable proposals to set the company back on the right track. They were met with hostility, threats of costly legal fights, and a noose. Defendants violated California law and they will be held accountable.”
It has been a busy few months for Hyperloop One, one of two high-profile startups working on Elon Musk’s proposed idea for an ultra-high speed tube-based transport system. In May, the company held a live propulsion test in the Nevada desert, and has already begun construction of a full-scale test site, “Devloop”, in North Las Vegas.
The company has attracted major investment and a series of high-profile partnerships, including engineering firms Arup and AECOM. The company recently announced an agreement with the Russian government, and a high-profile feasibility study into a route from Helsinki to Copenhagen. On June 16, ahead of the Russian deal, Shervin Pishevar met with President Putin.
Despite the lawsuit, the company states, “Hyperloop is on track, its board and team are united and today's bogus lawsuit will have no impact on its goal of becoming the first company to bring the Hyperloop to the world.”
[Updated on July 13 2016: This story has been updated to include statements from legal representatives on both sides, plus clarifications on details of the court document.]
This article was originally published by WIRED UK
