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As lawsuit ripples, Hyperloop One leaders reportedly cede some control

Shervin Pishevar
John Gurzinski | AFP | Getty Images
Shervin Pishevar

Amid a nasty lawsuit, two of Hyperloop One's leaders are scaling back their control of the start-up, Bloomberg reported on Friday.

Co-founder Shervin Pishevar and board member Joe Lonsdale will now each control 20 percent of voting shares of the embattled transportation tech company, down from a combined 78 percent, sources told Bloomberg's Sarah McBride. The move was a gesture of goodwill, said one of the two sources, who attended a series of all-hands meetings in recent weeks.

The move was revealed after a fellow co-founder and defector Brogan BamBrogan filed a lawsuit alleging widespread mismanagement and nepotism within the company, enabled in part by "the disproportionate influence that the current ownership structure provides," McBride points out. The company has called the suit "unfortunate and delusional."

Pishevar told CNBC earlier this year that the company has raised close to $100 million to work on the Hyperloop, a futuristic transportation system — envisioned by Elon Musk — that works with hardware like levitation rigs, wind tunnels and electromagnetic test stands.

Pishevar's attorney didn't immediately respond to CNBC's request for comment.

For more on Hyperloop One's voting proposal, see the full article at Bloomberg.com.