May 23, 2007
Brin, Google, 23forMe, and the Subtlety of Law Practice
Posted by Jeff Lipshaw
Over at Conglomerate, Christine Hurt has a nice summary of and take on the Sergey Brin/Google investment in his wife's startup. The comments are already starting to look a little bimodal, so I'll throw in my two cents that this is a wonderful example of how subtle decisions in the real world can be.
As Christine points out, this is a really tough call. If in fact Brin thought it was a great investment, he's doing Google shareholders a favor by allowing them to participate. Hence, it's possible that his intent is pure.
Indeed, given that Google invests in startups, if this weren't his wife/girlfriend, and he had only invested his own money, would he have breached his fiduciary duty to Google by misappropriating a corporate opportunity?
On the other hand, if Brin has provided an advantage to his spouse that he would not to the spouse of any other employee in the company, that has an odor to it.
But he did the right things. The investment was discussed in the board and at the audit committee. Money is coming into the venture from other VCs, and credible sources like Genentech. If Google has an avenue in which employees can feed investment possibilities to the corporate development group, I'd say a good bit of the odor goes away. It would have been an interesting situation in which to be the corporate governance lawyer.
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