Figure AI was sued by the former product safety director for ignoring an internal warning that it wa..

Robert Grundel, a former product safety engineer at Figure AI, filed a federal suit in Northern California alleging he repeatedly warned CEO Brett Adcock and a senior engineer that a humanoid robot could exert force sufficient to “fracture a human skull,” citing a malfunction that gouged a steel refrigerator door 0.25 inches, and was fired days after submitting a written safety report; he also alleges the company trimmed a “product safety roadmap” when courting investors and treated safety as an obstacle while completing a Parkway-led funding round that valued Figure at $39 billion. Grundel is seeking a jury trial and economic and punitive damages, alleging retaliatory termination and possible investor deception, while Figure AI denies the claims, attributes the firing to poor performance and says it will contest the suit. Framed by his lawyer as a potential early whistleblower case on humanoid-robot safety, the litigation raises legal, regulatory and reputational risks for Figure AI and could prompt heightened investor and regulator scrutiny.

Analysis

Former Figure AI product safety engineer Robert Grundel filed a federal suit in Northern California alleging he repeatedly warned CEO Brett Adcock and senior engineer Kyle Ethelberg that a humanoid robot could exert force sufficient to "fracture a human skull," and that he was fired days after submitting a written safety report. The complaint cites a malfunction that gouged a steel refrigerator door to a depth of 0.25 inches (≈6 mm) and asserts management "drastically reduced" a product safety roadmap while finalizing a Parkway VC-led funding round that valued Figure at $39 billion in September.

Grundel seeks a jury trial with economic and punitive damages, arguing safety concerns were treated as obstacles rather than obligations; Figure AI denies the claims, says the firing was for poor performance, and intends to contest the suit. The company's $39 billion private valuation—about a 15-fold increase since early 2024—raises the potential financial and reputational stakes if allegations that safety documentation was downplayed are substantiated.

This litigation creates immediate legal, regulatory and reputational risk that could slow commercialization, intensify investor due diligence, and set precedent for whistleblower cases in humanoid robotics. Sentiment signals are moderately negative and market impact is material but uncertain; ultimate investor exposure will depend on court outcomes, any regulatory inquiries, and whether the alleged gaps in safety governance are proven.

Key Decisions for Investors

• Monitor federal court filings and company disclosures over the next 60–90 days and pause new direct or fund allocations to Figure AI until independent evidence of remedial safety testing or an external audit is provided
• For existing investors, reassess fair value and consider marking down the private valuation premium given the $39 billion price and the risk that litigation or regulatory action could delay commercialization or trigger investor claims
• Require or obtain the product safety roadmap, board-level safety governance minutes, and contractual milestone/escrow protections before committing additional capital in any future funding rounds
• Hedge or limit incremental exposure to the broader humanoid-robotics cohort and watch for contagion risk from precedent-setting whistleblower or regulatory actions