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JAMES N. KRAMER (STATE BAR NO. 154709)

jkramer@orrick.com
ORRICK, HERRINGTON & SUTCLIFFE LLP
The Orrick Building
405 Howard Street
San Francisco, California 94105-2669
Telephone:
(415) 773-5700
Facsimile:
(415) 773-5759
BLAKE L. OSBORN (STATE BAR NO. 271849)
bosborn@orrick.com
ORRICK, HERRINGTON & SUTCLIFFE LLP
777 South Figueroa Street, Suite 3200
Los Angeles, California 90017
Telephone:
(213) 629-2020
Facsimile:
(213) 612-2499
Attorneys for Plaintiffs
Cruise Automation, Inc. and Kyle Vogt

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SUPERIOR COURT OF THE STATE OF CALIFORNIA

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CITY AND COUNTY OF SAN FRANCISCO

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CRUISE AUTOMATION, INC., a Delaware

corporation, and KYLE VOGT,
Plaintiffs,

Case No.
COMPLAINT FOR DECLARATORY
RELIEF

v.
JEREMY GUILLORY,
Defendant.

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COMPLAINT FOR DECLARATORY RELIEF

Pursuant to California Code of Civil Procedure Section 1060, plaintiffs Cruise

Automation, Inc. (Cruise or the Company) and Kyle Vogt bring this Complaint for

Declaratory Relief arising out of the claimed equity interests in Cruise by defendant Jeremy

Guillory. Plaintiffs allege on personal knowledge as to themselves and their own acts, and upon

information and belief as to all other matters, as follows:

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INTRODUCTION
1.

This case arises out of Defendants opportunistic and brazen attempts to extort

money from Cruise and Mr. Vogt. As alleged below, after mutually parting ways with Mr. Vogt

over two years ago, Mr. Guillory emerged from the shadows with his hand out within days of the

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March 11, 2016 news that General Motors Company (GM) intends to acquire Cruise. As

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explained below, Mr. Guillory should put his hand back into his pocket; he does not have any

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stake in the Company.

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2.

Defendants shocking and opportunistic claim is an attempt to thwart, interfere or

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otherwise delay GMs merger acquisition of Cruise for his own pecuniary benefit. Knowing that

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his claim could interfere with the GM transaction, Mr. Guillory hopes to leverage his extortionist

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claims to achieve a pay-off from the Company. Declaratory relief is therefore necessary to

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remove potential uncertainty regarding equity ownership, partnership interests, intellectual

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property and trade secrets of the Company.

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3.

Mr. Guillorys baseless allegations have also caused an unnecessary and damaging

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delay in the sale of Cruise to General Motors. Time is truly of the essence in the highly

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competitive and frenetic race in the development of autonomous technology. Any continued

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delay damages Plaintiffs. As a result, Plaintiffs seek the Courts immediate resolution of this

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matter so that Cruise and General Motors may proceed to fulfill the respective benefits of their

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bargain.

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PARTIES
4.

Plaintiff Cruise is a corporation incorporated under the laws of the State of

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Delaware with its headquarters and principal place of business in San Francisco, California.

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Cruise is developing the software and necessary hardware to make it possible for vehicles to be
-1COMPLAINT FOR DECLARATORY RELIEF

driven autonomously on city streets. By developing autonomous vehicle technology, Cruise

seeks to increase mobility, reduce carbon emissions and oil consumption, regain time and hours

of lost productivity due to driving, and save billions of dollars and lives due to car accidents.

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Plaintiff Kyle Vogt is an individual currently residing in California.

6.

Defendant Jeremy Guillory is an individual currently residing in California.

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JURISDICTION AND VENUE

7.

This Court has jurisdiction over Defendant pursuant to Section 410.10 of the

California Code of Civil Procedure because Defendant resides in California, and has taken actions

in California that have injured the Company in this state.

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8.

Venue in this Court is proper, pursuant to Section 410.10 of the California Code of

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Civil Procedure, because the subject matter of the litigation is ownership of and injury to a

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company that is located in the City and County of San Francisco.

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FACTUAL ALLEGATIONS

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9.

Mr. Vogt is the founder and Chief Executive Officer of Cruise. Prior to founding

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Cruise, Mr. Vogt co-founded two other successful startups in Justin.tv, Inc. and Twitch. Twitch

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was a subdivision of Justin.tv and became the ESPN of video gaming. Twitch was later acquired

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by Amazon.com, Inc. for approximately $1 billion.

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10.

Embarking on his next company, Mr. Vogt incorporated Cruise as a Delaware C

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Corporation in early to mid-September 2013. At the time, Cruise was a pure start up with no

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products. Through the hard work and dedication of Mr. Vogt and others at Cruise over the course

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of 2014, the Company developed a working prototype of an aftermarket addition to a vehicle,

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containing cameras, radar, GPS and other sensors, and capable of delivering features such as

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precision steering, car and lane tracking, adaptive speed control, and collision avoidance. The

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Company shifted focus in 2015, and has since spent its efforts developing the software and other

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technology for a fully autonomous vehicle capable of driving on city streets.

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On or about September 30, 2013, Danielle Fong, a common friend of Mr. Vogt

and Defendant, introduced the two via email due to their common interests. After the

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introduction, on or about October 3, 2013, Mr. Vogt and Defendant met for the first time to

discuss the autonomous vehicle space.

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Between October 3, 2013 and November 11, 2013, after Mr. Vogt had already

founded Cruise, Mr. Vogt and Defendant exchanged various emails and correspondences where

they discussed a potential collaboration in working to develop Cruise (the Early Discussion

Period).

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Despite these early conversations, by mid-November 2013, it became clear that

Mr. Vogt and Mr. Guillory had personalities and visions that were not compatible and the two

decided not to pursue any collaboration on Cruise. After this decision, Jeremy never participated

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in or contributed to any Cruise business.

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During the Early Discussion Period between Mr. Guillory and Mr. Vogt:

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(a)

No stock of Cruise was issued to Defendant;

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(b)

Defendant did not invest in Cruise;

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(c)

Defendant did not pay any sum of money or other form of collateral for

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any equity interest in Cruise;

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(d)

Defendant did not receive any stock options in Cruise;

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(e)

Defendant did not write code for any technology being developed by

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Cruise;

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(f)

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developed by Cruise; and

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Defendant did not draft, file or create any patents for the technology being

(g)
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Defendant did not build any devices or technology for Cruise.

While Mr. Guillory had initially been listed on Cruises application to Y

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Combinator, following the mutual decision between Defendant and Mr. Vogt to pursue separate

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interests, on November 19, 2013, Mr. Vogt interviewed alone with Y Combinator partners. Y

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Combinator is a company that provides seed fundingthe earliest stage of venture funding to pay

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expenses while a company is just startingin return for small stakes in the companies it funds.

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Mr. Guillory never took part in any fundraising efforts for Cruise. Already having

parted ways with Mr. Guillory, Mr. Vogt individually met with other executives of venture capital
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firms for seed funding in late November and December 2013. Following the interviews and

pitches with various venture capital firms, Mr. Vogt and Defendant did not exchange any emails

or communications about Cruise.

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17.

In January 2014, Cruise completed its first round of seed funding. As alleged

above, Defendant had no involvement with Cruise or in raising this capital.

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After receiving its first round of seed funding, between January 2014 and

September 2015, Cruise hired employees to grow the Company, and to build and test prototypes

of its autonomous vehicle technology. Similar to most startup companies, Cruise granted certain

employees, officers, and directors equity in the form of stock options as part of their

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compensation package. Early investors in the seed funding were also given equity in Cruise. As

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alleged above, Defendant never received stock options in Cruise.

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All of the stock option agreements issued to Cruise employees, officers or

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directors contained a vesting schedule of four years with a one year cliff. In particular, Mr.

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Vogts stock options were subject to the following vesting schedule:

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The Vesting Shares, if any, shall be released from the Repurchase Option as hereafter
described in this Section 3(a)(iii) and in Section 3(a)(iv), provided, however, that such
scheduled releases from the Repurchase Option shall immediately cease as of the
Termination Date. Fractional shares shall be rounded to the nearest whole share. Subject
to the foregoing, 1/4th of the Vesting Shares shall be released from the Repurchase Option
on the 12-month anniversary of this Agreement, and an additional 1/48th of the Vesting
Shares shall be released from the Repurchase Option on the corresponding day of each
month thereafter (and if no corresponding day, the last day of the month), until all Vesting
Shares are released from the Repurchase Option.

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Notwithstanding the foregoing, if Purchaser is terminated without Cause [] by the

Company [] in connection with or within 12 month(s) following the consummation of a
Change of Control [], then the vesting of the Unvested Shares shall accelerate such that
the Repurchase Option in Section 3(A) shall lapse as to 100% of the Unvested Shares.

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This common Silicon Valley vesting schedule means that an employee, including

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Mr. Vogt, earns equity in Cruise evenly every month for four years, but an employee is entitled to

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zero equity if the employee departs Cruise in less than one year from their start date. Thus, while

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Defendant never received any stock options in the Company, if he had, they would have been

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subject to the same vesting schedule.

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In September 2015, Cruise completed its second round of funding for $12.5

million. Defendant again had no involvement with Cruise or in raising capital for this second

round. Indeed, on September 21, 2015, Defendant emailed Mr. Vogt a congratulatory message

about the second round of funding. Defendants email made no allegation or reference to any

equity ownership in Cruise.

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From its inception to present, Cruise has grown from Mr. Vogts vision into a

fifty-person firm and is among the few companies with permits from the state of California to test

autonomous vehicles.

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23.

With hopes of speeding development of self-driving cars, on March 11, 2016, GM

announced that it was acquiring Cruise.

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Three days later on March 14, 2016, Defendant emerged from the shadows and for

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the first time asserted that he had an equity ownership stake in Cruise. Prior to the announcement

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of the acquisition, Defendant had never, in any form, made any allegation or reference to any

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equity ownership in Cruise or contribution to Cruises source code or intellectual property.

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25.

Defendants sudden and shocking claim is a brazen and opportunistic attempt to

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secure an unjustified payout from Cruise by threatening to interfere with or otherwise delay the

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GM transaction.

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26.

Defendant has not disputed the fact that he did not invest in Cruise.

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Defendant has not disputed the fact that no stock of Cruise was issued to him.

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Defendant has not disputed the fact that he did not receive any stock option

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agreement during his brief involvement with Cruise.

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Defendant has not disputed the fact that even if he received stock in Cruise (which

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he did not receive), it would be subject to a one year vesting cliff that, because of the decision to

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part ways with Mr. Vogt, would not have been met.

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30.

Defendant has not disputed that his participation in any Cruise activities lasted for

less than 6 weeks in 2013.

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Defendant did not hire or contribute to the recruiting or hiring of anyone who has

worked for or presently works for Cruise.

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32.

Defendant has not disputed the fact that he did not write code for any technology

developed or being developed by Cruise.

33.

Defendant has not disputed the fact that he has not filed any patents for the

technology developed or being developed by Cruise.

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Defendant has not disputed the fact that he did not develop or build any device(s)

or technology for Cruise.

35.

Defendant has not attempted to provide any facts that support his purported

conclusion that he is entitled to an ownership interest in Cruise.

CAUSES OF ACTION

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First Cause of Action Declaratory Judgment

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(Equity Ownership Interest)

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36.

Plaintiffs allege the allegations set forth in Paragraphs 1 through 34 above and

incorporate them herein by this reference.

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An actual controversy has arisen and now exists between the Plaintiffs and

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Defendant concerning their respective rights. Specifically, Defendant contends that he has an

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equity interest in Cruise. Plaintiffs deny that any such equity interest exists.

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38.

Even if Defendant ever had an equity interest in Cruise (he does not), his equity

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interest is subject to the vesting schedule applicable to all employees, officer and directors,

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including Mr. Vogt. Cruises vesting schedule contains a one year cliff, which means that

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Defendant must remain employed by or at the Company for at least one year before any

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ownership interest vests.

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39.

Plaintiffs therefore seek a declaratory judgment that:

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(a)

Defendant has no equity ownership interest in Cruise; or

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(b)

In the alternative, if the Court finds that Defendant has some equity

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ownership interest in Cruise, then that equity interest is subject to Cruises vesting schedule

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containing a one year cliff and that equity interest never vested.

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40.

A judicial determination of the parties rights and obligations as alleged herein is

necessary because Defendant has frustrated Cruises acquisition by GM, and to remove potential

uncertainty with respect to ownership of the Company.

Second Cause of Action Declaratory Judgment

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(Partnership)
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incorporate them herein by this reference.

42.

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partnership with Plaintiff Vogt in Cruise. Plaintiffs deny that any such partnership exists or
existed. Even if Defendant had a partnership with Plaintiff Vogt in Cruise (he does not), the
partnership was terminated when Defendant left the Company in November 2013.
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44.

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Plaintiffs therefore seek a declaratory judgment that:

(a)

No partnership exists between Cruise and Defendant; and

(b)

No partnership exists between Plaintiff Vogt and Defendant.

A judicial determination of the parties rights and obligations as alleged herein is

necessary because Defendant has frustrated Cruises acquisition by GM, and to remove potential
uncertainty with respect to a partnership of the Company.
Third Cause of Action Declaratory Judgment

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An actual controversy has arisen and now exists between the Plaintiffs and

Defendant concerning their respective rights. Specifically, Defendant contends that he has a

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Plaintiffs allege the allegations set forth in Paragraphs 1 through 40 above and

(Intellectual Property)
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Plaintiffs allege the allegations set forth in Paragraphs 1 through 44 above and

incorporate them herein by this reference.

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An actual controversy has arisen and now exists between the Plaintiffs and

Defendant concerning their respective rights. Specifically, Defendant contends that he has rights
to certain intellectual property and the autonomous self-driving technology of Cruise. Plaintiffs
deny any such allegation. Specifically, Defendant never contributed to or worked on any
technology or intellectual property of Cruise.
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47.

Plaintiffs therefore seek a declaratory judgment that Defendant has no rights

whatsoever to the intellectual property and autonomous self-driving technology of Cruise.

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A judicial determination of the parties rights and obligations as alleged herein is

necessary to remove potential uncertainty with respect to the intellectual property of the

Company.

Fourth Cause of Action Declaratory Judgment

(Trade Secrets)

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49.

Plaintiffs allege the allegations set forth in Paragraphs 1 through 48 above and

incorporate them herein by this reference.

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An actual controversy has arisen and now exists between the Plaintiffs and

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Defendant concerning their respective rights. Specifically, Plaintiffs maintain certain trade

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secrets regarding their autonomous self-driving technology, and given Defendants recent

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allegations, Plaintiffs have reason to be concerned that Defendant may attempt to use such trade

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secrets in his future endeavors.

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51.

Plaintiffs therefore seek a declaratory judgment that Defendant has no right to

own, use, or disclose any trade secrets of Cruise.

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A judicial determination of the parties rights and obligations as alleged herein is

necessary to remove potential uncertainty with respect to the trade secrets of the Company.

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PRAYER FOR RELIEF

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WHEREFORE, Plaintiffs pray for the following relief:

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1.

For a declaration that Defendant has no equity ownership interest in Cruise;

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2.

For a declaration that no partnership exists between Cruise and Defendant;

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3.

For a declaration that no partnership exists between Plaintiff Vogt and Defendant;

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4.

For a declaration that Defendant has no rights whatsoever to the intellectual

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property of Cruise;

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5.

For a declaration that Defendant has no right to own, use, or disclose any trade

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secrets of Cruise;

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6.

For costs of suit herein incurred;

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For reasonable attorneys fees and costs as allowed by law;

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For such other and further relief as the Court may deem proper.

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Dated: April 8, 2016

ORRICK, HERRINGTON & SUTCLIFFE LLP

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James N. Kramer

Attorneys for Plaintiffs

Cruise Automation, Inc. and Kyle Vogt

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COMPLAINT FOR DECLARATORY RELIEF