AI Startup Sues Ex-CEO Saying He Took 41GB of Email, Lied On Resume

An anonymous reader quotes a report from Ars Technica: Hayden AI, a San Francisco startup that makes spatial analytics tools for cities worldwide, has sued its co-founder and former CEO, alleging that he stole a large quantity of proprietary information in the days leading up to his ouster from the company in September 2024. In a lawsuit filed late last month in San Francisco Superior Court but only made public this week, Hayden AI claims that former CEO Chris Carson undertook what it called "numerous fraudulent actions," which include "forged board signatures, unauthorized stock sales, and improper allocation of personal expenses." [...] Hayden AI, which is worth $464 million according to an estimated valuation on PitchBook, has asked the court to impose preliminary injunctive relief, requiring Carson to either return or destroy the data he allegedly stole. Specifically, the lawsuit alleges that Carson secretly sold over $1.2 million in company stock, forged board signatures, and copied 41GB of proprietary company emails before being fired in September 2024. The complaint also claims Carson fabricated key parts of his resume, including a PhD and military service. It's a "carefully constructed fraud," says Hayden AI.

"That is a lie," the complaint states. "Carson does not hold a PhD from Waseda or any other university. In 2007, he was not obtaining a PhD but was operating 'Splat Action Sports,' a paintball equipment business in a Florida strip mall."

ha

[nomadic]

Great advertising for their AI.

Re:

[shanen]

So you want a joke? Here's my attempted AI joke of the day:

So one day Musk's pet GROK told the YOB that the summary of Article 2 of ye olde Constitution is "You can do whatever you want." And look what happened.

Are we seeing a proof by contradiction of Kant's Categorical Imperative or is the YOB about to refute ye olde Kant thusly?

Oh yeah. I better define my term. #YOB = YUGE Orange Buffoon. I reject the YOB's personal brand thusly.

AI Bros Learn New Phrase - Due Diligence

[Gilmoure]

No one checks resumes anymore?

Re:

[Viol8]

Maybe the AI did and hallucinated that he was an entirely honest genius.

Re:

[HiThere]

If he was one of the founders, perhaps he had the job of doing the checks.

LOL

[Mr. Dollar Ton]

Hayden AI, which is worth $464 million

A bunch of vaping tiktokers who exchanged their models via email are "worth" half a billion?

To whom?

I have been a CTO of 3 companies now.

[ghinckley68]

I have yet to see a honest resume. I have been hiring IT personal since 1997 not one honest resume ever.

Re:I have been a CTO of 3 companies now.

[nightflameauto]

I have yet to see a honest resume. I have been hiring IT personal since 1997 not one honest resume ever.

Honest resumes get filtered out by the HR drones. Probably filtered out by the AI the HR drones utilize at this point.

Re:

[Quakeulf]

I've been the CTO of two companies, and I always look at the portfolio and ask the tough technical questions early. It makes hiring superfast and weeds out all the pretenders. I've made my best hires over random social media posts because I could tell they knew what they were doing and were trying to achieve things that aligns with what I need. Regular "HR-led" hiring starts in the wrong end with the "vibecheck" which of course all technical people will fail miserably.

Re:

[dfghjk]

I suspect you are the liar. I have never lied on a resume and I have interviewed plenty that do not appear to have lied either.

Re:

[ArchieBunker]

Honesty goes both ways.

Two takeaways from this

[Arrogant-Bastard]

1. Nobody did any kind of due diligence whatsoever on this guy. NONE. And then they showed the same level of attentiveness to what he was doing: NONE. So while their lawsuit may have some merits, this entire sordid affair could have been prevented if someone, anyone, had exhibited minimal competence.

2. I have no doubt that this is epidemic in the entire AI sector. Of course it is: everyone is too busy hyping their products/services or soliciting venture capitalists or making insane predictions ("AI will solve global warming") to spend any time doing the nuts-and-bolt work of running a solid business operation. This reminds me very much of the dot-com boom 30 years ago, when the exact same thing happened: any hustler who could talk a good game could land a job and a huge paycheck and then bail out before the roof caved in. (Some of them were sued, but most weren't, because the companies that failed either no longer existed or lacked the resources to engage in protracted litigation.)

Re:

[Gilmoure]

'endemic'

#FTFY

Re:

[martin-boundary]

It did start out as an epidemic, though ;-)

Re:

[NobleNobbler]

Part of the psychopathy playbook is cultivating enough confidence and status that the other side "would hate to loose out on this guy in high demand by having onerous due diligence periods"-- if they fail to find a mark, they just move on. 1 out of even 20 or 100 isn't bad to land a huge gig based on fraud.

Where was the due diligence?

[2TecTom]

They clearly failed to perform proper due diligence before appointing the CEO. There's clearly no shortage of incompetent people in a corrupt economy.

Co-Founder Resume?

[The Faywood Assassin]

Wait a minute.

How does a co-founder need a resume?

Do you need to apply to start a company?

Re:

[karmawarrior]

I'm guessing the investors would require a resume before agreeing to invest in a company like this.

Re:

[noshellswill]

Resume not needed. Investors can get a list of your peer-reviewed papers and patents ( also of-course in your resume )  from a data aggregator. While  start-ups and leaps up any corporate ladder are closely followed by both Forbes and WSJ.

Re:

[Whateverthisis]

They're not going after him for lying on his resume. Your resume is simply your profile, and investors readily assume what it says is who you are; his LinkedIn says the same thing.

They're going after him for fraud on stock sales, embezzlement (that's the misallocating expenses to the company thing), and taking his emails and such. The resume thing is most likely to establish a personality profile in their complaint that would make the actual charges seem more plausible; ie he lied about a PhD, so yes h

One sided story

[oumuamua]

If you found a company you expect to be rewarded if it becomes successful. There could be good reason to get rid of a CEO making bad decisions but it could also be simple backstabbing, which is legendary in Silicon Valley and something the TV show got right even if slightly exaggerated: https://www.reddit.com/r/cscar... [reddit.com]

Not another one...

[linuxguy]

> he was not obtaining a PhD but was operating 'Splat Action Sports,' a paintball equipment business in a Florida strip mall."

Florida man strikes again.

Re: Not another one...

[retchdog]

Your honor, I got my Ph.D. from the well-known School of Hard Knocks!

Huh? RETURN DATA?

[Warren416]

How do you RETURN DATA you stole? You can't prove you don't have a copy.

Re:

[HiThere]

You may not even have had the data for longer than it takes to reformat the drive. But if you have it, you can return it. This, of course, doesn't prove you didn't keep a copy.

Re:

[martin-boundary]

Extreme physical torture is a tried and true way to prove that he doesn't have a copy. Stop making assumptions that do not apply in the real world.

To be borne in mind

[RUs1729]

The percentage of individuals with high levels of psychopathy indicators have been found to be significantly more noticeable among people in the executive tiers of for-profit companies. I would not be surprised that, if the allegations against him are true, Mr. Carson were to belong to such a group: if so, chances are Mr. Carson felt no compunction nor remorse about having made up important aspects of his résumé and about grabbing data that he was not entitled to grab.

are we supposed to be outraged?

[dfghjk]

/. regular SuperKendall lies about his professional qualifications and that's OK, /. is full of regular posters who lie constantly and promote candidates for President who are daily liars.. In a culture of pathological lying, why isn't this just fine? Lying for me, not for thee?