Yes. When part of a deal’s value goes to people who join the buyer, or to a license instead of a sale of the company, stockholders who don’t join can end up with less than they expected. A new lawsuit over Nvidia’s deal with Groq, which no court has decided, puts that question in the spotlight.

Reviewed by Svetlana Kamyshanskaya Pantelic, Founding Partner, Primum Law Group

A $20 billion deal should be a win for everyone holding stock. A new lawsuit over Nvidia’s deal with AI chip startup Groq shows how deal structure can decide who actually gets paid.

This case study describes allegations in a complaint. No court has ruled, and Groq has called the lawsuit meritless.

Nvidia’s deal with Groq wasn’t a traditional acquisition. According to the complaint, as reported by FourWeekMBA, it had two parts:

• A $17 billion license of Groq’s technology.
• About $3 billion in Nvidia restricted stock units for the Groq employees Nvidia hired.

Roughly 150 to 200 Groq engineers moved to Nvidia, along with founder and CEO Jonathan Ross, according to CNBC. Plaintiffs describe the structure as a reverse acqui-hire.

On October 2, 2026, two former Groq engineers, Joshua Rubin and Benjamin Serebrin, filed suit in the Delaware Court of Chancery. Both had left Groq before the deal but still held stock, and neither received a job offer from Nvidia.

Their core allegations:

• No stockholder vote. They claim the board effectively sold the company without the stockholder approval Delaware law requires.
• No real price test. They claim there was no process designed to test or maximize what Nvidia paid.
• Conflicted directors. They claim a board majority, including investor-designated directors, had conflicts that shaped the outcome.

The plaintiffs themselves acknowledge, per Tom’s Hardware, that no Delaware decision has directly answered the question their case raises. That’s why this one is worth watching.

License-plus-hire deals have become a popular way for large tech companies to bring in startup teams and technology without a formal acquisition. Whatever the court decides here, the case puts a spotlight on a question every founder and early employee should be asking: when the exit comes, does the money flow through the cap table or around it?

In a traditional acquisition, every stockholder gets paid according to the company’s charter and agreements. In a structure where part of the value goes to the people who join the buyer, stockholders who don’t join, including former employees, can end up with a smaller share than they expected.

• Your exit terms are written long before your exit. Your charter, voting agreements, and investor rights decide who has to approve a sale and how proceeds are split. Read them now, not when a buyer calls.
• Process protects the board, and you. When directors have ties to investors or stand to benefit personally, a documented process for testing the price and managing conflicts is what holds up later.
• Every stockholder counts, including former employees. People who leave with vested equity are still stockholders. Treat them that way in any deal.

If you hold startup equity, know what you own and what rights come with it. Keep your stock documents, and understand how a sale, license, or acqui-hire could treat you differently from the colleagues who stay.

The size of an exit tells you how much value was created. The structure tells you who gets it.

Building toward an exit? Make sure your corporate documents decide who gets paid, not the buyer’s preferred structure.

Primum Law Group helps startups get investor-ready and structure financings and exits. Learn more about our services for startups.

Book a consultation with our team: