I think the issue is even simpler. When NVIDIA ended his advisory relationship in 1996, he had 90 days to exercise his vested options. That deadline passed nearly 30 years ago, regardless of whether vesting took one year or four.

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.

Yes. I noted this below. A lot of times you see a decimal point in the wrong place and the courts don't just say "oh well, I guess it's a billion then!"

The rulings are fact-specific, but clearly both parties here had a mutual understanding that the paper was only meant to reflect.

>You made a mistake and now I can get a billion dollars more than we agreed to originally

The world "smart contract" enthusiasts dream of.

Yeah, it's a little unclear but I think your interpretation is correct. The key is the paragraph beginning with:

> 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.

Yeah, that's the problem with this. Should one get the present day value of the shares (a billion), or present day value of the worth at that time (thousands)?

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.

What happened to the $1.7 billion of shares that you did get by exercising your options?

I don't have the same story but I did turn down a job offer from Nvidia in '97 which I think about from time to time.

> And the process of discovery would be very costly for NVIDIA with depositions from many executives who have better things to do.

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.

I don't understand how your name could not have been carried along on the cap table all these years. In my experience when I've made an investment in an early stage company and they have a liquidity event, they come looking for me.

You understand expected value right?

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.

I empathise. I won’t go into detail here, but 20 years ago I built something that went on to be a major commercial success - after I had been coerced into signing over ownership at the pointy end of a lawyer. For not dissimilar reasons, it’s a lost cause at this point.

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.

Thanks for sharing your story in straightforward detail. Do you believe, in an ethical sense (independent of the legal sense), that you are owed roughly a billion dollars?

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.

Your blog post is making a logical error. You're assuming that you're being owed the right to exercise your options retroactively so you calculate the foregone value of the stock you could have had if you exercised, which is dishonest because they can only deliver expired options to you.

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 was a great read and I am inspired by your stoic philosophy and it's sort of amazing that I can just talk to you via Hackernews :-D

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!

At the risk of being reductive, I think that under the common law, contract terms are usually interpreted objectively unless they are ambiguous, in which case you might consider extraneous evidence. Clear language is enforced as written.

Depends upon the canon of construction for written contracts that you accept as correct.

Yeah, I agree with this

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

The article states that they exercised their options.

I've never been on either side of one of situations, but if the company is doing well, why doesn't the company just take care of the human? These don't really seem like opening-the-flood-gates types of decisions and companies could just choose to do if they wanted to, right?

This German newspaper describes his life in (or on?) Tonga in even more detail: https://www.spiegel.de/netzwelt/web/portrait-einmal-tongaer-...

It is a very interesting read, and I can only recommend it. Some of it is one sentence after another that left me astonished.

Just today I clicked a to shortlink for my German Univeristy and thought "curious they use a non-EU shortlinker, is that legal or secure?".

Love to hear how that self-sustaining island project worked out!

I can only hope that my bank will someday feel the same way about my mortgage.

I realize we're talking about a civil case here and not criminal but it's not factually correct to say statutes of limitations always prevent a historical wrong from being addressed. There's a number of jurisdictions which have no statue of limitations on sexual assault cases for example.

Somewhat randomly chosen reference:

https://www.richardnelsonllp.co.uk/guides/statute-of-limitat...

> we can't keep litigating the past forever

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.

I don’t understand how that fits the author situation. Society isn’t a party, there is no crime or anything like that. We are talking about contractual terms

I doubt it for three very big reasons and you're wrong about one big point:

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...

> After much soul-searching, deliberation, and gnashing of teeth, my attorneys and I concluded that the statute of limitations was against us. Because of the thirty-odd years that had passed while I “sat on my rights,” it seemed unlikely we’d make it past a motion to dismiss.

That was my first thought as well.

Or, find one of the many interest groups who have a non-economic reason to hate NVIDIA.

What OP has here is a license to go on a fishing expedition through NVIDIA.

Would they? Surely they'd realize that they too have no chance of winning because of the same issue.

Why would anyone buy that right? Statute of limitations is crystal clear here. The case is going to be dismissed the moment it gets in front of a judge.

There’s already a relatively liquid market here around legal financing, but they only finance cases that can win. This is not a case that will result in anything but a dismissal.

Even if they won, Nvidia would only be obligated to deliver a fresh option contract. E.g. they would issue options today with the same strike price difference. The options mentioned in the block post are not worth more than $9000 and even that is generous. Selling those options on the open market probably would have generated $2250 in income.

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.

Absolutely this.

The value in 1996 when he could have exercised these options was probably $0 since Nvidia hadn’t gone public and was at risk of going bankrupt.

> Read papers given to you!

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.

> Read papers given to you!

I don't. I blame on the ADHD. Or maybe its laziness.

Thanks!

Tax (not cheating!,) optimization?

(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.)

https://www.tonic.to

I also wonder if he paid the correct taxes if he earned 1 billion dollars in 1996.

They don't own the stock as I understand it but never received options which they should have and would have been able to exercise. I assume they sold the remainder of the options long ago otherwise they have $3b in NVDA already and probably wouldn't have written this post.

Plethora of reasons, but right to title is not as black and white as anyone assumes. There is no govt ledger that keeps track of who owns what, everything is always subject to interpretation. If you own a home, you likely had to purchase title insurance. If you don’t know what that’s for, look it up. It will give you the same answer to this question.

They do not own the stock, because the options never vested and thus were never exercised. The time to assert that claim was 30 years ago.

Litigation is expensive, and the OP knows that the statute of limitations is against them, so it'll likely turn out to be an even more expensive lesson.

The only thing starting with a B is the bluff the in house counsel is asking them to call

Yea, laches in equity, right?

Eric Gullichsen sounds like a cool guy!

https://www.stuff.co.nz/life-style/homed/latest/132554070/am...

"If only I'd put all my money on red before they span the roulette wheel!"

Who in their right mind would buy a case that’s past the statute of limitations?

Just commented the same thing and agree 100%.

If you’ve exercised them, you’ve essentially bought the stock at that price and own it. Most people just sell them right away because they’re more interested in the payment on the difference between option price and current price. But you technically could exercise/buy it and just hold.

If you exercise them, they are yours.

Doesn’t matter what you are suing for. The window to do it closed a long time ago.

Probably sold them a long time ago.

Yep

I like it. Maybe we should look for young NVIDIAs

> if someone did this to me this is pretty much grounds for an irreparable relationship.

If someone tried to claim what was contractually theirs?

In general, most founding staff with lucrative contracts, are often pushed out just before an IPO. Doesn't matter if you were friends, worked 60 hour weeks building the company for years, or name is on the company patents.

A bit of cash can turn folks into awful people, and some contracts are just a obfuscated legal con of the naive. =3

You would still get unhandled exception errors

Bought $1000 of MSFT right after IPO. Went up 20% very quickly. Sold it immediately feeling confident I'd done the right thing. Worth $5+ million now I think?

Yep, I bought Apple at $19 after Steve Jobs went back to Apple. Sold them at $80.

What was the final result of your legal battle with the insurance company and their contractor?

You lived on a houseboat named SS Vallejo in Sausalito...

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 was in on the ground floor of WiFi, in that around 1995 I did a significant chuck of the work that proved that WiFi works, and my work at a university lead to the formation of a company that put WiFi into the market (Radiata). The IP situation was murky. A patent holder made about $1b and the company sold for $560m (in 2000). I gather the university complained and got a good chunk of "go away" money. I could have thrown my hat in the ring: maybe I would have got something, maybe I wouldn't have. Either way, I walked away, as I judged it wasn't worth the non-financial cost. 30 years layer I still think I made the right decision. I might have been living in a nicer house, but I wouldn't have the life I have today, which I am happy with.

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.

Quads and biquadratic texture mapping truly were an awful choice and it's incredible that the company still pulled through. I have an NV1 floating around somewhere; I should dust it off again.

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.

Do you still program for fun ?

I’m in a small game dev group and I very much enjoy seeing how older engineers tackle problems.

In 1989 I was consulting for a large company in NYC that hired you to give our small UI/UX team a demo of your VR system. I still remember strapping on the headset and looking around the virtual world. I might even have your business card somewhere!

What was your gain on the 15,625 shares you did own? What year did you sell them?

How bad was the motion sickness back then and what kind of hardware were people using for the headsets?

Did anything progress past tech demos?

The Kingdom of Tonga stood out to me. Are you still there? Why were you there? It's a very interesting place, especially for anyone not from there. I'm only adjacently aware as someone who spent most of my life in a different Polynesian country.

Don’t jeer or snipe on HN. Even if your framing is true, it’s an awful way to address anyone. If it’s false (which it likely is) it’s utterly vile.

We recommend reading the article before commenting.

I think that's an overly charitable reading.

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.

No. Owner did not exercise all of the options he was entitled to because he relied on a miscalculated value in a letter reminding him he could exercise them. So he should have paid them and he’s arguing it’s their fault he didn’t remember the other options.

Correction: The writer chose not to engage a lawsuit after receiving advice it was likely to be dismissed given 30 years had passed.

Correction: the author accepted a grant for X options, that they must exercise to own. The author exercised a percentage of the options. They did not exercise all of their options. They left the company without exercising the remaining options. This is equivalent to forfeiting the options.

Now, 25 years later the author is preparing a litigation.

Oh man, who said the author was white? And why would this even matter for this post? I can't believe how some people manage to bring up the race issue in any possible context, regardless if it's relevant or not.

If he was writing to the people of the Kingdom of Tonga, it might make sense to describe himself as an immigrant. If his audience is largely American, though, the story is much more clear with "expat".

Amazing how differing the opinion is here based on who is being fucked over by legalese, if it's an individual -- yep you signed the agreement, can't do shit. If's a company who bungled something -- woops, it was an honest mistake.

Almost as if people here go an extra length to be shit eating morons.

Well in reality it’s not that big of a mistake because he probably would have sold these shares when he sold the first 62.5%……which I assume was not recently

The author didn't appear to be mad to me when I read this.