alt Hacker NewsOwed a billion dollars in Nvidia stock
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An open question is what happened to the 15,625 shares that he received when he exercised his options in 1996?
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.
Author here. Thanks for all the comments, I've been hesitant to post this to the court of public opinion, yet curiosity about what the HN community would think caused me to push the button. My lawyers - who were really excellent - represented me (on contingency!) because it seemed the chance of a judge not accepting a motion to dismiss (for a variety of reasons I don't want to detail here) was non-zero. And the process of discovery would be very costly for NVIDIA with depositions from many executives who have better things to do.
> Here in the land of the free, it turns out a company only has to honor its contractual obligations for a little while.
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?
Similarly, I had the option to CPU-mine almost as much Bitcoin as I wanted in 2008 when I first read the whitepaper, but I didn't, so I guess I should write an article about how half of Satoshi's coins should be mine?
The angle I haven't heard, yet I think would make the most sense, is that you both understood the agreement correctly, at the time.
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.
You are ultimately responsible for asserting your contractual rights. Your stock options had an expiry and you did not exercise them in time. The letter you received notifying that you had 15,625 vested options was not an award in of itself, it was only a courtesy notifying you that you had vested options to exercise before they expired. Even if due to ambiguous wording it could be argued that 25,000 options had vested at the time instead of 15,625, that was only relevant until the options expired. You needed to assert your rights to the [additional 9,375] vested options before they expired. So, this issue died in 1996.
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.
This guy has had some interesting side quests.
https://time.com/archive/6735546/hes-the-master-of-his-domai...
As this is an interesting story I think we need a change to HN algorithm.
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
The houseboat has an interesting history: https://qaswa.com/ss-vallejo
It seems to me that if OP had been granted 25k shares instead of 15k, he would have sold 25k shares instead of 15k. So even aside from the statute of limitations, the damages would be something like the value of 10k shares in 1993, perhaps plus 30 years of interest.
You should sell your right to litigate this. There are hundreds of firms that would pay you to take this on. Would involve near zero effort for you and would also check the box of being “about the principle”.
> Here in the land of the free, it turns out a company only has to honor its contractual obligations for a little while.
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.
To satisfy the curious, "I have been everything, and nothing is worth it."
Well quoted.
I'm confused, 4 quarters or 4 years, he never exercised the remaining batch of options, so what is the basis of his suit? That somebody should have reminded him he had options outstanding? What am I getting wrong or missing here?
Read papers given to you!
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
> Then, in April 1996 - by which time I’d expatriated to the Kingdom of Tonga and was working on various internet startup schemes
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".
Why does a stockholder have to reassert their rights to hold the stock that they already own?
For me the fair outcome would be Nvidia paying the 1996 share-price + inflation; not the 2026 share-price. They could neither force him to hold them for 30 years; not prevent him from having bought as many as he wanted. The only error was they slightly underpaid him.
I can also see why these claims age out; else all old companies would have enough uncertainty they would be uninvestable.
Way of my league here but if it starts with a B and they said sue them, why not go ahead and sue them?
You’re not the only one who want to see this go somewhere.
When I worked at a startup, I didn't care about my stock option at all. My expectation is really low for any early stage companies. I understand why something like this could happen.
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.
Seems like you should sell your rights to the suit to a third party for a flat fee and percentage of recovery.
Given his advanced age, he should have sold his lawsuit rights. Sealed bid auction and could even let Nvidia bid as well.
Every 1% expected value would put it at $10 million dollars.
I found the facts a bit hard to follow, but is his claim that they actually agreed to the accelerated vesting schedule, or that it was a drafting error? In the latter case, it's probably not just the statute of limitations that is blocking his claim in law or equity here.
> This invitation followed a meeting I had with Jensen, Curtis Priem, and Chris Malachowsky on my houseboat
> 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!
> Then, in April 1996 - by which time I’d expatriated to the Kingdom of Tonga...
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.
So the shares he did receive are worth well over $1B too right?
I am not too financially literate, but if the 4 quarters with a 1-year cliff was the period then, what would their value had been? Around $5.75M (6,250 shares per quarter x 4 = 25000 * $230/share)?
Don’t options expire (ex. Leaving the company)? How would this work thirty years later?
This was a fun read. Reminiscent of all the "I have bitcoin on a hard drive I misplaced" stories
That has to be one of the most painful “I should have checked the paperwork” stories ever. Imagine discovering 30 years later that your forgotten NVIDIA shares could have been worth a billion dollars.
These are always fun little what ifs. In 2012 I sold $50k in Amazon stock to pay off my student loans - a hilariously bad financial decision in retrospect, since the loans had capped interest rates, and that $50k of 2012 amazon stock would be worth over a million today...
So is there not a case for suing not for the shares but being told the wrong information at the time? It seems wrong to be mislead by a company who owes you shares in this way.
> NVIDIA did not dispute the authenticity of the option agreement, only that my claims were long since time-barred.
Was this part of the agreement since the beginning or did they add this afterwards, and if so did they clearly communicate to you?
Well, better sell them because nvidia will be a victim of their own success. Who is going to write CUDA kernels if you can just ask AI to do it for you? At that point you might as well target different architectures.
I put this firmly in my category of "Bitcoin Millionaires". Well, yes, technically, if you had noticed at the time, and you had sued them and they had lost (which they might not, it seems he knew the paperwork was a mistake) then you would have had 9,375 more shares, and then if you'd kept them you'd have a billion dollars more worth of Nvidia stock.
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.
I briefly worked at Games Workshop when the employee share save price was ~340p. Sadly they didn't pay enough for me to afford to buy shares on top of my rent, so I had to leave. Crazy to think they're all multi-millionaires now.
if i were jensen i'd give the dude a Billion for the PR
Options can be worthless I've had two friends whose options were clawed back. Exercise the options asap - harder to steal the stock back than the options.
I was kicked out from the MD programme at Université de Sherbrooke due to a procedural failure. The school covered it up, I was devastated.
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.
Not sure how to feel about it.
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.
Why not ask your friends to give you the equivalent stock today ?
It took me a while to figure out what happened, but this is my understanding.
1. OP was granted 25,000 options.
2. OP was told by Nvidia their options had vested and they need to 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?
I don't blame him for trying, but it seems like a long shot.
The strong will survive. Ain't no love ain't no gratitude. Just leather jackets and zero sum game theory
I feel like I'm going crazy reading the comments, and I guess, big props to the author for writing this in a way that pulls it off.
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!