Court Rejects Former Xiaohongshu Employee's Option Vesting Lawsuit
Jiang Dong, a former Xiaohongshu employee, lost his court case over stock option vesting after the company terminated his contract eight days before his 50% vesting milestone. Jiang had been promised 800,000 options upon joining in 2018, plus 60,000 more in January 2020. The court ruled the August 2020 dismissal lawful, citing absenteeism. Jiang claims dozens of colleagues faced similar dismissals before vesting dates. Xiaohongshu has not commented.
On August 10, Jiang Dong, a former Xiaohongshu employee, published a post on a public platform disclosing his dispute with Xiaohongshu over the vesting of stock options. Jiang joined Shuxing Technology (Beijing) Co. , Ltd. , a Xiaohongshu subsidiary, in September 2018 as Chief Technology Expert, and later served as head of the media intelligence team. Upon joining, the company promised to grant him 800,000 options in an overseas entity, with 50% vesting after two years of service. In January 2020, Jiang received an additional grant of 60,000 options. In August of the same year, Xiaohongshu terminated his employment, leaving only eight days until his two-year anniversary and the first 50% vesting milestone.
Thereafter, Jiang and Xiaohongshu entered judicial proceedings over the termination and option vesting. Court documents show Xiaohongshu argued that the first exercise required two full years from the grant date, namely October 30, 2020, but that the employment relationship had been lawfully terminated on August 25, 2020, citing absenteeism and other conduct as grounds. The court ultimately found the termination lawful and dismissed all of Jiang's claims.
Jiang believes the timing of the termination was deliberately arranged and said that dozens of colleagues in his work groups had been dismissed on various grounds before key vesting dates. As of press time, Xiaohongshu had not responded to the matter.