A boardroom battle over control of a robotics vehicle business with Carnegie Mellon University ties has ended up in court, with the former CEO of the Findlay company and his investment group accusing Giant Eagle of trying to gain control at a discount while he was trying to save the company.
In a lawsuit filed this week in Allegheny County Court of Common Pleas, Anthony Horbal, who became CEO of Seegrid Corp. in 2012, said the O’Hara grocer blocked his efforts to bring in outside capital even as the company faced a cash shortage that threatens its future.
“Our clients believe Giant Eagle and its principals are attempting to hijack one of Pittsburgh’s most promising companies — in an effort to garner its tremendous value for themselves,” said William A. Brewer III, partner at Bickel & Brewer in Dallas and lead counsel for plaintiffs, in an email. “Our clients believe that Giant Eagle took direct aim at them, and took steps to force them out of the company they helped build.”
Since at least April, the lawsuit said, the Seegrid board and Giant Eagle have known that “by mid-July, if not sooner, Seegrid would face a cash shortage that would threaten its ability to continue to conduct business.”
A Giant Eagle spokesman said the company is confident the case will be dismissed.
“As the majority shareholder in Seegrid Corp., Giant Eagle continues to believe that Seegrid can be a successful company. Contrary to the allegations in the complaint, Giant Eagle has always acted appropriately as a Seegrid shareholder. The complaint was filed on behalf of a disgruntled former CEO, and it contains numerous material misstatements and is wholly without merit,” said Rob Borella, senior director of corporate communications, in an email.
The lawsuit seeks injunctive relief to keep Giant Eagle from “interfering with the management agreement,” in addition to an unspecified amount of damages.
The lengthy court filing describes a startup founded in 2003 by CMU robotic scientists Hans Moravec and Scott Friedman. The company makes robotic vehicles that can handle tasks in industrial settings, according to Seegrid’s website.
Seegrid was initially funded with by a small group of investors and a contract from Samsung, according to the lawsuit. Giant Eagle tested Seegrid’s prototype robots in its warehouse, according to the suit, and was asked by Mr. Friedman to invest.
Mr. Horbal came in December, investing $3 million in return for 20 percent ownership, according to the lawsuit. A past Seegrid press release indicate he sold his own business, Three Rivers Health Plan, to United Health Plans in 2008. At Seegrid, he started as president and a director.
Horbal’s group’s ownership interest at this point is between 15 percent and 16 percent, the lawsuit said. Giant Eagle, the lawsuit said, would own more than 60 percent of Seegrid, if it converted its notes into stock.
Mr. Horbal felt Seegrid needed a cash infusion of $10 million to $20 million, but claimed Giant Eagle and its representatives have been threatening to liquidate Seegrid unless the board agrees to turn the operation into a subsidiary of Giant Eagle.
Teresa F. Lindeman: email@example.com or at 412-263-2018.