Management daydreaming. In reality there are 2 possibilities: the startup is either successful or it's not. In the former case, he'll hire his own better lawyer

Management daydreaming. In reality there are 2 possibilities: the startup is either successful or it's not. In the former case, he'll hire his own better lawyers and bury their claim. In the latter, it's not worth their time. As long as you're not using their equipment and don't give them a way to prove you were using their time, they won't have a leg to stand on to make that claim (even if your employment contract has language that looks scary to an engineer with no legal background).