Chief Nvidian Huang admits coveting 3dfx engineers

IN HIS LATEST TESTIMONY concerning the 2001 acquisition of 3Dfx, Nvidia Chief Executive Jen-Hsun Huang told a San Jose court that he had to play a sneaky game in order not to annoy the engineers from the company that he wanted to hire.

"The two companies had been in competition for so long, the animosity would be so significant that forcing their engineers to come to Nvidia would be impossible," he said.

Huang is having to defend himself in federal bankruptcy court against a bunch of investors who claim Nvidia bought 3Dfx on the cheap.

He said he'd been very interested in snaffling up the engineering expertise. "That was my primary interest all along," he confessed.

To this end he said he decided to ensure 3Dfx paid off its creditors so that those involved in the graphics chip maker could, "wind down their company in a graceful way."

He hoped such goodwill would help persuade the engineers he had his eye on that Nvidia was a nice place to work.

"We came across as a company that was not taking advantage of them," he said. "All of that contributed to our ability to recruit engineers."

In the end Nvidia hired some 100 of the 120 engineers at 3Dfx.

A central sticking point in the wrangle is a line in a report that Nvidia's former chief financial officer, Christine Hoberg prepared at the time. A list of assets mentions "75 engineers at $1 million per..."

Per what? You may ask. As did the prosecution. Huang says the reckoning was that the engineers could potentially generate around a million dollars in revenue per year. "She never implied the engineers were valued at $1 million each," claimed Huang.

The investors feel they got shafted in the deal because Nvidia didn't include the engineers when it bought the company. Instead, it wooed them separately.

Beancouter Hoberg got in trouble with the Securities and Exchange Commission over a completely separate issue in 2003, when she was accused of overstating Nvidia's earnings. She coughed up close to $672,000 to settle the matter without ever admitting any responsibility. The firm later had to re-state nearly three years of financial numbers.

This latest wrangle still has some way to run. µ

See Also
One hundred and twenty 3dfx hearts beat at Nvidia
3DFX: Voodoo still lives in our hearts forever

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