A former executive is embroiled in a legal battle with his previous company, alleging wrongful termination and unfair business practices. Ambuj Kumar filed a complaint against Fortanix, Inc., a Delaware corporation, on November 27, 2024, in the Superior Court of California, County of Santa Clara.
The lawsuit centers around Kumar's claims that Fortanix breached the covenant of good faith and fair dealing by terminating his employment under false pretenses. Kumar co-founded Fortanix in 2016 and served as its CEO until December 1, 2022. Under his leadership, the company experienced significant growth, increasing its valuation to approximately $480 million and securing over $135 million in funding. However, Kumar alleges that after successfully leading a Series C fundraising round that brought $90 million into the company in August 2022, he was wrongfully terminated before receiving compensation commensurate with his contributions.
Kumar's complaint accuses Fortanix of engaging in unfair business practices by failing to honor promises made regarding his long-term employment and compensation. He asserts that he signed a temporary employment agreement based on assurances from Fortanix that he would remain CEO following the Series C raise. The complaint also highlights that Fortanix withheld critical financial information necessary for Kumar to sell part of his ownership stake after his termination, forcing him to accept less than its actual value.
In addition to breach of covenant and unfair business practices, Kumar accuses Fortanix of unjust enrichment and failure to permit inspection of books and records. He seeks compensatory damages for lost earnings and benefits, restitution for unjust gains obtained by Fortanix at his expense, and an order compelling the company to comply with California Corporations Code § 1601 regarding shareholder rights to inspect corporate records.
Represented by Jonathan D. Dykstra from Watts Law LLP, Kumar is pursuing relief through compensatory damages exceeding jurisdictional limits and reimbursement for legal expenses incurred during this action. The case is assigned Case No. 240V452913 in the Superior Court of California, County of Santa Clara.