Xiaodi Hou, the co-founder and former CEO of self-driving trucking startup TuSimple, has urged a California district court docket to concern a brief restraining order to cease the corporate from transferring its remaining U.S. property to China, based on a current court docket submitting.
Hou, who plans to use for a brief restraining order in December throughout the subsequent scheduled court docket listening to, is hoping to maintain TuSimple from shifting tens of hundreds of thousands of {dollars} in money to China. As of September, TuSimple had roughly $450 million in capital. Hou can also be requesting expedited discovery of proof to help his requests for the movement.
Hou’s declaration to the court docket, filed on Monday, is the most recent escalation within the battle between TuSimple and a few of its shareholders, over the corporate’s makes an attempt to make use of investor capital to fund a brand new AI-generated animation and online game enterprise in China.
This is the primary time Hou — who was ousted from his function as CEO in 2022 — has publicly accused TuSimple and its leaders of funneling property towards animation and gaming companies owned by or with direct ties to Mo Chen, TuSimple co-founder and chairman of the board, beneath the guise of a enterprise pivot. Hou additionally argued the corporate violated SEC rules by neither informing nor gaining approval from shareholders earlier than altering its enterprise course or transferring funds to China.
Hou now heads a brand new autonomous trucking startup in Texas
TuSimple, as soon as valued at $8.5 billion after its 2021 IPO, confronted setbacks that led to its U.S. shutdown and delisting in January 2024. The firm’s acknowledged objective was to commercialize its AV know-how in China. But because the 12 months progressed, TuSimple slashed its workforce, ceased self-driving operations, and started hiring workers to deal with jobs associated to AI gaming and animation.
Shareholders despatched a letter to the board in August after studying TuSimple was placing sources towards AI gaming and animation. The board responded a pair weeks later by publicly saying the brand new enterprise unit.
Hou this week urged the court docket to concern a brief restraining order after noticing a submitting by TuSimple China that signaled the corporate was about to switch cash (or already had) out of the United States. Two TuSimple China subsidiaries final week registered a rise in property collectively value $150 million, based on Hou’s declaration and data from public filings.
“These filings show a suspicious increase in registered assets between these two subsidiaries in one day as a precursor to large amount of cash transfer from U.S. to China,” reads the declaration. “The most likely scenario is that these filings in China were the preparatory steps before TuSimple U.S. transfers money to those subsidiaries in China.”
Hou added that such massive money transfers are “beyond normal course of business” and similar to “TuSimple China’s heyday of operation when it was operating a large autonomous truck fleet in Shanghai” and had round 700 staff on its payroll. As of September, TuSimple China had round 200 staff.
The window of alternative for shareholders like Hou to get what they need — which is for TuSimple to liquidate to allow them to recuperate a few of their losses — is narrowing.
TuSimple is in a grey space relating to enforcement from the Securities and Exchange Commission. While TuSimple delisted earlier this 12 months, the corporate continues to be registered with the SEC and thus topic to U.S. scrutiny. Once the cash goes to China, shareholders within the U.S. may have no recourse to claw again funds from their unique funding.
TechCrunch has reached out to the SEC to study if the company is investigating TuSimple in relation to shareholder complaints.
TuSimple didn’t instantly reply to TechCrunch’s request for remark.
