Google Moonshot startup SandboxAQ claims ex-CEO is trying to ‘blackmail’

A former SandboxAQ executive filed a wrongful termination suit last month filled with such salacious allegations against the company’s popular CEO, Jack Hydary, that the plaintiff himself redacted the most salacious details.

On Friday, the company’s lawyers filed a scathing response, calling the former employee a “serial liar” and stating that his lawsuit “asserts false claims for improper and extortionate purposes.”

Even the visual portions of the lawsuit — obtained by TechCrunch — contain claims that are surprising, if the court finds them true. (A A copy of the lawsuit is available here.)

The case offers a rare inside look at how employee lawsuits can become a public airing of dirty laundry from opaque internal events, thanks to private arbitration clauses ubiquitous in Silicon Valley employee agreements.

The lawsuit was filed by Robert Bender in mid-December. Bandar served as Heidari’s chief of staff from August 2024 until July 2025, the complaint states. He asserts in his lawsuit that he was wrongfully terminated after raising concerns about a number of alleged incidents, some of which, he said, involved “sexual encounters” and others, he claims, involved misleading financial information provided to investors.

For its part, SandboxAQ strongly denies these accusations. “This case is completely fabricated,” corporate attorney Oren Snyder, a well-known partner at white-shoe law firm Gibson Dunn, tells TechCrunch. “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 particularly notable is the number of Valley business associates involved in SandboxAQ. The company is an AI-powered quantum computing startup that started out as a flagship unit of Google’s parent company Alphabet, which Hidary leads at Google. Haidari is also well-known in Silicon Valley as a long-time X Prize board member.

SandboxAQ spun off from Alphabet to become an independent company in March 2022 with Hedry as CEO and quickly attracted big-name investors, including billionaire and former Google CEO Eric Schmidt, who invested and became chairman of the startup. Other billionaire investors include Salesforce CEO Marc Benioff, venture capitalist Jim Breyer, and Bridgewater hedge fund founder Ray Dalio.

Bandar’s lawyers say: Another judicial document The revised sections “describe the sexual encounters and physical condition of non-parties observed by Plaintiff during business travel.” In other words, the alleged incidents involve people who Bender is not suing. This is an unusual step – it is usually the party being sued who requests the redaction, not the person making the allegations.

There are different explanations for such a tactic, and TechCrunch was unable to confirm the motives in this case. In general, the possibilities range from protecting innocent third parties not accused of wrongdoing, to an extortion strategy – suggesting the potential for more damaging details to emerge if defendants do not offer an acceptable settlement.

The unredacted portion of the lawsuit provides some general details about the allegations that were suppressed: Bandar alleges that Haidari used company resources and investor money to “solicit, transport, and entertain female companions.” In the attached gallery of a text message from Bandar mentioning prostitutes.

Bandar also alleges in his lawsuit that Heidari sold tens of millions of dollars worth of his stock at a premium price based on what Bandar says were misleading numbers provided to potential investors. He asserts in the suit that the revenue figures presented to the board were 50% lower than the numbers shown in presentations to potential investors.

SandboxAQ’s attorneys strongly disagree with all of the above. “The Company did not make fraudulent disclosures to investors in connection with the tender offer or otherwise. The CEO did not misuse the Company’s assets. Plaintiff invented these inflammatory allegations to manufacture legal claims and to protect himself from the consequences of his misconduct.”

For his part, Bandar claims that the company was trying to discredit him. His complaint asserts that he filed his lawsuit “solely because his termination was followed by a malicious scorched-earth campaign to destroy his reputation.”

While the validity of any of these claims is for a jury to decide, many of his claims reflect a SandboxAQ investigative report he published Information In July.

The sources told The Information newspaper that Haidari was using the company’s resources to transport the women he was dating on the company’s private planes, and that the company’s revenues were far below its expectations. Bender refers to the story information in his lawsuit but denies that he was its source. SandboxAQ claims it was a source and lies about its involvement. (A copy of the company’s full response can be obtained from SandboxAQ, including more allegations about the employee Found here.)

Despite any controversies, big-name investors were keen to invest in the company last year. In April, SandboxAQ It raised more than $450 million In a Series E funding round from Ray Dalio, Horizon Kinetics, BNP Paribas, Google and Nvidia.

SandboxAQ too It announced a $90 million secondary sale. SandboxAQ has raised a total of $1 billion, She saysIt is worth $5.75 billion, according to PitchBook estimates.