SandboxAQ, an independent company that spun out of Alphabet in March 2022, is embroiled in a legal battle with Alphabet. The battle is fueled by accusations from its ex-Chief of Staff, Robert Bender. In mid-December, Bender did take action by filing the lawsuit. He alleged that Jack Hidary, the company’s CEO, was misusing corporate resources and investor funds to enrich himself. The controversy has raised serious questions about the appropriate governance and public corporate purpose of the booming, billion-dollar startup. It has drawn hundreds of millions of dollars in financial support from big-name investors.
Under the leadership of CEO Jack Hidary, SandboxAQ has attracted substantial investment, raising over $450 million in a Series E funding round. Other prominent funders include billionaire Eric Schmidt, who has assumed the position of chair. To date, SandboxAQ has raised close to $1 billion. PitchBook estimates its current valuation at around $5.75 billion.
Robert Bender as Chief of Staff to Hidary August 2024 – July 2025 In his lawsuit, he accuses Hidary of using company resources to “solicit, transport, and entertain female companions.” Bender claims that Hidary dumped tens of millions of dollars in stock. He alleges that this was done specifically at inflated prices, based on overstated revenues provided to prospective investors in a misleading manner.
Bender allegations the revenue numbers Board were 50% lower than what was disclosed to investors. This discrepancy is troubling enough, but the lack of transparency is even more alarming. His complaint comes as a continuance to an investigative report released by The Information in July. It’s possible that this report has contributed to the current scrutiny over SandboxAQ’s activities.
Addressing the allegations, SandboxAQ has categorically denied wrongdoing. The company’s lawyers have personally attacked Bender, including calling him a “serial liar.” They argue that his allegations are untrue and designed to shake down the company.
“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.” – SandboxAQ’s lawyers
Similarly, Orin Snyder, the well-known attorney who represented SandboxAQ, doubled down on the company’s position that it was in the wrong on the allegations.
“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.” – Orin Snyder
Bender’s lawsuit provides a detailed account of the misconduct on the road to show this was not an isolated incident. She offers potent accounts of her own sexual experiences and insights on the state of corporeality for the unindicted.
“describe sexual encounters and the physical condition of non-party individuals observed by Plaintiff during business travel.” – Bender’s attorneys
SandboxAQ’s increase has been extraordinary since founding last year, particularly with its support from well-connected investors. With its strong focus on quantum technologies and artificial intelligence, the company has found itself at the front lines of technological innovation. Hidary, the charges have sparked fears over corporate ethics and accountability in such a cutthroat arena.
SandboxAQ just announced a $90 million secondary sale, at a rumored valuation of $1 billion. This shift might have been prompted by the active litigation. That has allowed the company’s lightning-fast growth to continue stealing headlines from competitors and claiming the attention of investors and industry analysts alike. The current allegations come close to upending its reputation.
The legal battle highlights the complexities facing startups in the tech industry, especially those dealing with significant amounts of capital and high-profile investors. As this case develops, it will be important for SandboxAQ to successfully rebut these allegations and do so without shaking investor confidence.