4 ms·

Lost money. Same consequence either way, so there is no incentive for them to leave.

by ar_lan 3y ago

Davidzheng 3y ago
They don't have equity in openai though right. You mean from reputation loss?
- jacquesm 3y ago
  For starters about 700 employees seem to think their livelihood matters and that the board didn't exercise their duty of care towards them.
  - JumpCrisscross 3y ago
    > about 700 employees seem to think their livelihood matters and that the board didn't exercise their duty of care towards them It is difficult to see how such a duty would arise. OpenAI is a non-profit. The company's duty was to the non-profit. The non-profit doesn't have one to the company's employees; its job was literally to check them.
    - jacquesm 3y ago
      To check them does not overlap with 'to destroy them at the first opportunity'. There is no way that this board decision - which now is only supported by three of the original nine board members - is going to survive absent a very clear and unambiguous reason that shows that their only remedy was to fire the CEO. This sort of thing you don't do by your gut feeling, you go by the book.
      - JumpCrisscross 3y ago
        > no way that this board decision...is going to survive absent a very clear and unambiguous reason that shows that their only remedy was to fire the CEO The simplest explanation is Altman said he wasn't going to do something and then did it. At that point, even a corporate board would have cause for termination. Of course, the devil is in the details, and I doubt we'll have any of them this week. But more incredulous than the board's decision is the claim that it owes any duty to its for-profit subsidiary's employees, who aren't even shareholders, but some profit-sharing paper's holders.
        jacquesm 3y ago
        True, but then the board would have been able to get rid of the controversy on the spot by spelling out their reasoning. Nobody would fault them. But that didn't happen, and even one of the people that voted for Altmans' removal has backtracked. So this is all extremely murky and suspicious. If they had a valid reason they should spell it out. But my guess is that reason, assuming it exists, will just open them up to more liability and that is why it isn't given. > But more incredulous than the board's decision is the claim that it owes any duty to its for-profit subsidiary's employees, who aren't even shareholders, but some profit-sharing paper's holders. Technically they took over the second they fired Altman so they have no way to pretend they have no responsibility. Shareholders and employees of the for-profit were all directly affected by this decision, the insulating properties of a non-profit are not such that you can just do whatever you want and get away with it.
        JumpCrisscross 3y ago
        > the board would have been able to get rid of the controversy on the spot by spelling out their reasoning I don't think they have an obligation to do this publicly. > even one of the people that voted for Altmans' removal has backtracked I don't have a great explanation for this part of it. > Shareholders and employees of the for-profit were all directly affected by this decision, the insulating properties of a non-profit are not such that you can just do whatever you want and get away with it We don't know. This is truly novel structure and law. That said, the board does have virtually carte blanche if Altman lied or if they felt he was going to end humanity or whatever. Literally the only thing that could go for the employees is if there are, like, text messages between board members conspiring to tank the value of the company for shits and giggles.
        jacquesm 3y ago
        Capriciousness and board membership are not compatible. The firing of a CEO of a massively successful company is something that requires deliberation and forethought, you don't do that just because you have a bad hairday. So their reasons matter a lot. What I think is happening is that the reason they had sucks, that the documents they have create more liability and that they have a real problem in that one of the gang of four is now a defector so there is a fair chance this will all come out. It would not surprise me if the remaining board members end up in court if Altman decides to fight his dismissal, which he - just as surprising - so far has not done. So there is enough of a mess to go around for everybody but what stands out to me is that I don't see anything from the board that would suggest that they acted with the kind of forethought and diligence required of a board. And that alone might be enough to get them into trouble: you don't sit on a board because you're going off half-cocked, you sit on a board because you're a responsible individual that tries to weigh the various interests and outcomes and you pick the one that makes the most sense to you and you are willing to defend that decision. So far they seem to believe they are beyond accountability. That - unfortunately for them - isn't the case but it may well be they escape the dance because nobody feels like suing them. But I would not be surprised at all if that happened and if it does I hope they have their house in order, board liability is a thing.
  - dragonwriter 3y ago
    Neither for-profit corporations nor charities have a general legal duty of care for the livelihood of their employees.
    - jacquesm 3y ago
      It's all about diligence and prudence. I don't see much evidence of either and that means the employees may well have a point. Incidentally: the word 'care' was very explicitly used in the letter.
      - dragonwriter 3y ago
        > It's all about diligence and prudence. Diligience and prudence apply to the things to which they actually are obligated in the first place, which the employees’ livelihood beyond contracted pay and benefits for the time actually worked simply is not included in.
        jacquesm 3y ago
        > which the employees’ livelihood beyond contracted pay and benefits for the time actually worked simply is not included in Quite a few of those employees are also stockholders, besides that this isn't some kids game where after a few rounds you can throw your cards on the table and walk out because you feel that you've had enough of it. You join a board because you are an adult that is capable of forethought and adult behavior. I don't quite get why this is even controversial, there isn't a board that I'm familiar with, including non-profits that would be so incredibly callous towards everybody affected by their actions with the expectation that they would get away with it. Being a board member isn't some kind of magic invulnerability cloak, and even non-profits have employees, donors and benificaries who all have standing regarding decisions affecting their stakeholdership.
        dragonwriter 3y ago
        > Quite a few of those employees are also stockholders None of them are stockholders, because (except for the nonprofit, which can't have stockholders even as a corporation) none of the OpenAI entities are corporations. Some of them have profit-sharing interests and/or (maybe) memberships in the LLC or some similar in interest in the holding company above LLC; the LLC operating agreement (similar function to a corporate charter) expressly notes that investments should be treated as donations and that the Board may not seek to return a profit; the holding companies details are less public, but it would be strange if it didn't have the same kind of thing since the only thing it exists is to hold a controlling interest in the LLC, and the only way it would make any profit is from profits returned by the LLC.

Lost money. Same consequence either way, so there is no incentive for them to leave.

by ar_lan 3y ago

Lost money. Same consequence either way, so there is no incentive for them to leave.

Davidzheng 3y ago

They don't have equity in openai though right. You mean from reputation loss?

jacquesm 3y ago
For starters about 700 employees seem to think their livelihood matters and that the board didn't exercise their duty of care towards them.
- JumpCrisscross 3y ago
  > about 700 employees seem to think their livelihood matters and that the board didn't exercise their duty of care towards them It is difficult to see how such a duty would arise. OpenAI is a non-profit. The company's duty was to the non-profit. The non-profit doesn't have one to the company's employees; its job was literally to check them.
  - jacquesm 3y ago
    To check them does not overlap with 'to destroy them at the first opportunity'. There is no way that this board decision - which now is only supported by three of the original nine board members - is going to survive absent a very clear and unambiguous reason that shows that their only remedy was to fire the CEO. This sort of thing you don't do by your gut feeling, you go by the book.
    - JumpCrisscross 3y ago
      > no way that this board decision...is going to survive absent a very clear and unambiguous reason that shows that their only remedy was to fire the CEO The simplest explanation is Altman said he wasn't going to do something and then did it. At that point, even a corporate board would have cause for termination. Of course, the devil is in the details, and I doubt we'll have any of them this week. But more incredulous than the board's decision is the claim that it owes any duty to its for-profit subsidiary's employees, who aren't even shareholders, but some profit-sharing paper's holders.
      - jacquesm 3y ago
        True, but then the board would have been able to get rid of the controversy on the spot by spelling out their reasoning. Nobody would fault them. But that didn't happen, and even one of the people that voted for Altmans' removal has backtracked. So this is all extremely murky and suspicious. If they had a valid reason they should spell it out. But my guess is that reason, assuming it exists, will just open them up to more liability and that is why it isn't given. > But more incredulous than the board's decision is the claim that it owes any duty to its for-profit subsidiary's employees, who aren't even shareholders, but some profit-sharing paper's holders. Technically they took over the second they fired Altman so they have no way to pretend they have no responsibility. Shareholders and employees of the for-profit were all directly affected by this decision, the insulating properties of a non-profit are not such that you can just do whatever you want and get away with it.
        JumpCrisscross 3y ago
        > the board would have been able to get rid of the controversy on the spot by spelling out their reasoning I don't think they have an obligation to do this publicly. > even one of the people that voted for Altmans' removal has backtracked I don't have a great explanation for this part of it. > Shareholders and employees of the for-profit were all directly affected by this decision, the insulating properties of a non-profit are not such that you can just do whatever you want and get away with it We don't know. This is truly novel structure and law. That said, the board does have virtually carte blanche if Altman lied or if they felt he was going to end humanity or whatever. Literally the only thing that could go for the employees is if there are, like, text messages between board members conspiring to tank the value of the company for shits and giggles.
        jacquesm 3y ago
        Capriciousness and board membership are not compatible. The firing of a CEO of a massively successful company is something that requires deliberation and forethought, you don't do that just because you have a bad hairday. So their reasons matter a lot. What I think is happening is that the reason they had sucks, that the documents they have create more liability and that they have a real problem in that one of the gang of four is now a defector so there is a fair chance this will all come out. It would not surprise me if the remaining board members end up in court if Altman decides to fight his dismissal, which he - just as surprising - so far has not done. So there is enough of a mess to go around for everybody but what stands out to me is that I don't see anything from the board that would suggest that they acted with the kind of forethought and diligence required of a board. And that alone might be enough to get them into trouble: you don't sit on a board because you're going off half-cocked, you sit on a board because you're a responsible individual that tries to weigh the various interests and outcomes and you pick the one that makes the most sense to you and you are willing to defend that decision. So far they seem to believe they are beyond accountability. That - unfortunately for them - isn't the case but it may well be they escape the dance because nobody feels like suing them. But I would not be surprised at all if that happened and if it does I hope they have their house in order, board liability is a thing.
- dragonwriter 3y ago
  Neither for-profit corporations nor charities have a general legal duty of care for the livelihood of their employees.
  - jacquesm 3y ago
    It's all about diligence and prudence. I don't see much evidence of either and that means the employees may well have a point. Incidentally: the word 'care' was very explicitly used in the letter.
    - dragonwriter 3y ago
      > It's all about diligence and prudence. Diligience and prudence apply to the things to which they actually are obligated in the first place, which the employees’ livelihood beyond contracted pay and benefits for the time actually worked simply is not included in.
      - jacquesm 3y ago
        > which the employees’ livelihood beyond contracted pay and benefits for the time actually worked simply is not included in Quite a few of those employees are also stockholders, besides that this isn't some kids game where after a few rounds you can throw your cards on the table and walk out because you feel that you've had enough of it. You join a board because you are an adult that is capable of forethought and adult behavior. I don't quite get why this is even controversial, there isn't a board that I'm familiar with, including non-profits that would be so incredibly callous towards everybody affected by their actions with the expectation that they would get away with it. Being a board member isn't some kind of magic invulnerability cloak, and even non-profits have employees, donors and benificaries who all have standing regarding decisions affecting their stakeholdership.
        dragonwriter 3y ago
        > Quite a few of those employees are also stockholders None of them are stockholders, because (except for the nonprofit, which can't have stockholders even as a corporation) none of the OpenAI entities are corporations. Some of them have profit-sharing interests and/or (maybe) memberships in the LLC or some similar in interest in the holding company above LLC; the LLC operating agreement (similar function to a corporate charter) expressly notes that investments should be treated as donations and that the Board may not seek to return a profit; the holding companies details are less public, but it would be strange if it didn't have the same kind of thing since the only thing it exists is to hold a controlling interest in the LLC, and the only way it would make any profit is from profits returned by the LLC.