When Denis Grosz invested in software startup Toptal LLC in 2012, he hoped the $1 million bet could one day make him a fortune.
Instead, it landed him on the receiving end of a lawsuit, leading to more than $2.6 million in damages against him and his new firm and possibly tens of millions more in legal fees.
At issue is a challenge to a fundamental convention in Silicon Valley: whether the startup has denied early investors a return by refusing to switch their decade-old convertible debt commitments into equity, tying up their holdings even as the company has flourished. Without ...
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