On Tuesday, Hyperloop One's former CTO and co-founder Brogan BamBrogan launched a broad complaint against the company and many of its executives, alleging labor violations, defamation, intentional infliction of emotional distress, assault, and breach of fiduciary duty. Among the claims, BamBrogan says that a fellow executive left a noose on his office chair after the former CTO voiced concerns about the company’s leadership to Moscow executives.

The Los Angeles-based Hyperloop One was formed two years ago to turn a white paper written by Tesla and SpaceX founder Elon Musk into a reality. Musk drew a rough outline of a rail line using magnetic tracks and pressurized tubes to send passengers and cargo 700mph, but the CEO declined to spend resources building the system and made his notes available to any enterprising group. Hyperloop One successfully tested its propulsion system in May in Nevada.

BamBrogan filed the lawsuit along with three other former employees of the company, including former Assistant General Counsel David Pendergast. In the complaint, the plaintiffs name co-founder Shervin Pishevar, his brother and the company’s former chief legal officer for Hyperloop One, Afshin Pishevar, and two other executives involved with the company.

The plaintiffs' accusations point to gross mismanagement of a startup that has been something of a media darling, in addition to claims of personal and legal threats showing a dramatic rift between the "finance" and "engineering" factions in the burgeoning company.

This all comes after BamBrogan and Pendergast suddenly left Hyperloop One earlier this month. At the time, Hyperloop One told Recode that Vice President of Engineering Josh Giegel would take over BamBrogan’s duties and be given a seat on the startup’s board. According to today’s complaint, Giegel has not accepted that position, and Hyperloop One's executives apparently "blocked the resignation e-mails of the Plaintiffs and Giegel from reaching their team members and to this day have persisted in telling employees that Plaintiffs are still full-time employees of Hyperloop One."

Money matters

The plaintiffs accuse the four named executives of engaging in nepotism and wasting company funds.

“Over the course of Plaintiffs’ employment, it became apparent that those in control of the company continually used the work of the team to augment their personal brands, enhance their romantic lives, and line their pockets (and those of their family members),” the complaint alleges. “Those with the expertise to bring the hyperloop concept to fruition… have been systematically marginalized, while the ‘money men’ who do not understand the technology spent little time seeking to understand its potential, focusing instead on puffery—turning the company into a marketing-driven exercise, instead of the engineering-driven enterprise it should be.”

BamBrogan and other former Hyperloop One employees say that executives’ family members and Pishevar’s fiancee were given preferential access to company funds when the services they rendered were subpar, “[constituting] blatant breaches of Defendants’ fiduciary duties under basic corporate law." The Plaintiffs specifically call out Joseph Lonsdale, a board member of Hyperloop One and the founder of a venture capital firm 8VC, as well as a co-founder of scandal-fraught Palantir Technologies, for forcing Hyperloop One to hire his younger brother’s two-person investment firm, called Fideras, although the firm had "no notable experience with companies building hardware and engaged in infrastructure development, and few independent contracts with international and top-tier funds."

The complaint also alleges that Shervin Pishevar pressured potential Hyperloop One investors to invest in Pishevar’s other investment fund, called Sherpa Capital. “It is reasonable to assume that numerous investors declined to invest in Hyperloop One out of disinterest in paying a quid pro quo to Sherpa Capital,” the plaintiffs claim.

The complaint also suggests that Shervin Pishevar and Lonsdale took advantage of other executives' ignorance about finances, stating that, “Between them, Shervin and Lonsdale now control approximately 78 percent of the shareholder voting rights,” and that "at the founding of the company, Shervin granted himself 90 percent of Hyperloop One’s common stock, and gave his co-founder, BamBrogan, only 6 percent (the remaining 4 percent was given to the initial Board members).”

Show of force

The problems within the company seem to have come to a head sometime earlier this year, when BamBrogan and 10 other employees—including Giegel—sent a letter to Shervin Pishevar and Lonsdale, citing concerns about the direction of the company.

After the eleven employees sent their letter of concerns, BamBrogan apparently called up the two Russian investors he was scheduled to meet with that week and told them that he would have to cancel the meeting to stay in California and work on fixing the issues within the company.

But Shervin Pishevar attended dinner with the investors in Moscow without BamBrogan and, according to the complaint, “just hours after that dinner, at 11:28pm California time, Shervin’s brother and Chief Legal Officer of Hyperloop One, Defendant Afshin Pishevar, strolled through Hyperloop One’s office and placed a hangman’s noose on BamBrogan’s chair. Hyperloop One’s security cameras captured it all.”

The complaint alleges that the eleven employees who signed the letter of concern were now targets for the executives named in the lawsuit and were told “if anyone who signed the letter was found to have engaged in any misconduct, all eleven would be held accountable; if anyone talked to investors about what was happening in the company, Hyperloop One would ‘come after’ them; if they did not toe the line, this would be the ‘worst day’ of their lives; and they would bleed the employees dry with frivolous lawsuits.”

BamBrogan is also suing Lonsdale for defamation. He claims that Lonsdale wrote an e-mail “to the entire Board and BamBrogan’s engineering team, describing him as ‘unstable,’ and ‘gone haywire.’” The former CTO also describes an incident in which Shervin Pishevar screamed at him for hosting “a partner from a premier venture capital firm in his garage,” apparently angry that BamBrogan was entertaining investors without Pishevar's input.

The plaintiffs are asking for an injunction restraining Hyperloop One and its affiliates from mentioning the Plaintiffs by name, as well as an apology, unspecified damages, legal fees, and punitive damages.

“Hyperloop is not a frivolity, a hobby, or a party trick,” the plaintiffs assert in their complaint. “It is a serious concept that deserves serious development.”

In a statement e-mailed to Ars Tuesday afternoon, Orin Snyder, a lawyer representing Hyperloop One, wrote: