Google moonshot spinout SandboxAQ claims an ex-exec is attempting ‘extortion’

Google moonshot spinout SandboxAQ claims an ex-exec is attempting ‘extortion’

A former SandboxAQ government filed a wrongful termination swimsuit last month full of such scandalous allegations against the company’s famed CEO, Jack Hidary, that plaintiff himself redacted the most salacious particulars. 

On Friday, the company’s legal professionals filed a blistering response, calling the former worker a “serial liar” and stating his lawsuit “asserts false claims for improper and extortionate purposes.”

Even the seen parts of the lawsuit — which TechCrunch has obtained — include eyebrow-raising allegations, ought to a court docket discover them legitimate. (A copy of the lawsuit is accessible right here.)

The case affords a uncommon inside take a look at how worker lawsuits can turn into a public airing of soiled laundry from in any other case opaque inner happenings, due to the ubiquitous non-public arbitration clauses in Silicon Valley worker agreements.

The swimsuit was filed by Robert Bender in mid-December. Bender labored as Chief of Staff to Hidary from August 2024 by July 2025, the criticism states. He contends in his swimsuit that he was wrongfully terminated after elevating issues about a lot of alleged incidents, some of which, he said, concerned “sexual encounters” and others, he claims, that concerned deceptive monetary data introduced to buyers. 

For its half, SandboxAQ vehemently denies the allegations. The company’s lawyer Orin Snyder, a well known associate at white shoe legislation agency Gibson Dunn, tells TechCrunch: “This case is a complete fabrication. We look forward to debunking these baseless allegations and exposing the lawsuit — as detailed in our answer — for what it is — an opportunistic and extortionate abuse of the judicial process.”

What makes the case significantly notable is the variety of Valley heavy hitters concerned in SandboxAQ. The company is an AI quantum computing startup that started as a moonshot unit of Google guardian company Alphabet, led at Google by Hidary. Hidary is also well-known in Silicon Valley as a longtime X Prize board member. 

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SandboxAQ was spun out of Alphabet into an impartial company in March 2022 with Hidary as CEO and soon attracted big-name buyers, including billionaire and former Google CEO Eric Schmidt, who invested and have become the startup’s chairman. Other billionaire buyers embrace Salesforce CEO Marc Benioff, enterprise capitalist Jim Breyer, and Bridgewater hedge fund founder Ray Dalio. 

Bender’s attorneys say in another court docket doc that the redacted sections “describe sexual encounters and the physical condition of non-party individuals observed by Plaintiff during business travel.” In other phrases, the alleged incidents contain people who Bender is not suing. This is an uncommon transfer — usually, it’s the occasion being sued that requests redactions, not the particular person making the allegations.

Various explanations exist for such a tactic, and TechCrunch couldn’t verify what the motivations are in this case. Generally talking, the prospects vary from defending harmless third events who aren’t accused of wrongdoing, to a shakedown strategy — signaling that more damaging particulars may emerge if the defendants don’t provide an acceptable settlement.

The unredacted portion of the swimsuit supplies a few more common particulars of the allegations that had been hidden: Bender is alleging that Hidary used company assets and investor funds to “solicit, transport, and entertain female companions.” In an connected exhibit of a textual content message from Bender, he mentions prostitutes. 

Bender additional alleges in his swimsuit that Hidary bought tens of hundreds of thousands of {dollars} price of his inventory at a premium value based on what Bender says had been deceptive figures introduced to potential buyers. He contends in the swimsuit that income figures introduced to the board had been 50% decrease than the figures shown in displays to potential buyers. 

SandboxAQ’s legal professionals vigorously contest all of the above. “The Company did not make fraudulent disclosures to investors regarding its tender offer or otherwise. The CEO did not misuse corporate assets. Plaintiff invented these inflammatory allegations to manufacture statutory claims and to insulate himself from the consequences of his own misconduct.”

Bender, for his half, alleges that the company has been attempting to smear him. His criticism asserts that he introduced his lawsuit, “only because his termination was followed by a malicious scorched earth campaign to destroy his reputation.”

While the validity of any of these allegations is for a jury to determine, many of his claims echo an investigative report on SandboxAQ revealed by The Information in July.  

Sources told The Information that Hidary was utilizing company assets to fly women he was courting on company jets, and that the company’s revenues had been far below its projections. Bender references The Information story in his lawsuit however denies he was a source for it. SandboxAQ claims he was a source and is mendacity about his involvement. (A duplicate of SandboxAQ’s full company response, including more allegations about the worker, may be discovered right here.)

Despite any controversies, big-name buyers had been desirous to put money into the company last 12 months. In April, SandboxAQ raised over $450 million in a Series E funding round from Ray Dalio, Horizon Kinetics, BNP Paribas, Google, and Nvidia. 

SandboxAQ also announced a $90 million secondary sale. SandboxAQ has raised $1 billion complete, it says, and is valued at $5.75 billion, according to PitchBook estimates.

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