SAN JOSE, Calif., Oct. 05, 2021 – Attorneys at Sanford Heisler Sharp (SHS) recently obtained an $8.3M arbitration award on behalf of Claimant Dr. Yuhui David Chen against Silicon Valley semiconductor company InnoGrit Corporation, its parent company Shanghai InnoGrit Technologies Co., Ltd., and InnoGrit CEO Dr. Zining Wu. The total award includes $650,000 in punitive damages against Dr. Wu personally and $500,000 in emotional distress damages. Please see the Arbitration Interim Award (including Findings of Fact, Conclusion of Law), and the Final Award.
InnoGrit is a privately held semiconductor company founded in 2016. It has offices and operations in both the United States and China. InnoGrit’s CEO, Respondent Dr. Zining Wu, was the Chief Technology Officer of Marvell Technology, a global leading semiconductor company, before co-founding InnoGrit. Dr. Chen alleged that he collaborated closely with Dr. Wu to co-found InnoGrit but was later denied his rightful share of the enterprise.
The arbitrator found that Dr. Wu and InnoGrit made and then disregarded false promises and representations to grant Dr. Chen a 20% equity share of the company, and in doing so committed both breach of contract and fraud. Further, in light of Dr. Wu’s fraudulent, dishonorable conduct, the arbitrator held him personally liable for punitive damages as a punishment meant to “actively discourage” him “from trying to deceive and manipulate others (including other employees of InnoGrit) in the future.”
The final award, is the culmination of a years-long legal battle following Dr. Chen’s original complaint filed in Santa Clara Superior Court on October 31, 2018. The matter was moved to arbitration with JAMS in March 2019. A 10-day arbitration hearing was held in December 2020.
“Our client, Dr. Chen, never wavered in his conviction to hold InnoGrit and Dr. Wu to account for attempting to deny him out of his rightful share of the Company,” said SHS Senior Litigation Counsel Leigh Anne St. Charles. “The arbitrator’s award not only vindicates Dr. Chen’s steadfast perseverance in his personal fight for justice; it is a tribute to the immense power that can come from one person taking a stand and fighting for the truth.”
Dr. Chen expressed similar sentiments, stating: “My faith in the legal process was not misplaced. The truth won out. The arbitration award means so much to me and my family.”
According to the arbitration ruling, Dr. Chen will receive a total award of approximately $8.3 million including $3.6 million in attorneys’ fees and costs.
Kevin Sharp, the Managing Partner of SHS’s Nashville office, stated that it is “particularly remarkable that this result was achieved through arbitration, which has been the preferred forum for many large corporations. This is a testament to our client’s fortitude and the strength of his claims.”
SHS’s Asian American Litigation and Finance Practice Chair Qiaojing Ella Zheng emphasized the implications of the award. “Unfortunately, it may be the case that this type of situation is all too common in tech startups, in the Silicon Valley, and elsewhere where a history of friendship and mutual trust results in agreements that never get reduced to writing,” she observed. “Companies and executives should take heed that they must honor their oral promises just the same as their written agreements, and cannot abuse the trust of their co-founders, partners, executives, and employees.”
About Sanford Heisler Sharp
Sanford Heisler Sharp is a national public interest class-action litigation law firm with offices in New York, Washington, DC, San Francisco, San Diego, Nashville, and Baltimore. Sanford Heisler Sharp focuses on employment discrimination, wage and hour, whistleblower, criminal/sexual violence, and financial services matters. The firm has recovered over $1 billion for its clients through many verdicts and settlements.
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