- Cyrus Hodes, co-founder of Stability AI, sues CEO Emad Mostaque, alleging he was misled into selling his stake under the false impression that the company was worthless.
- Hodes wants his 15% stake restored, claiming Mostaque concealed negotiations with venture capital firms and the firm’s projected valuation of $4 billion.
- Stability AI dismisses the lawsuit as meritless and pledges to defend its position aggressively, while facing other legal issues like alleged copyright violations.
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