Moonshot AI executives are negotiating a settlement with Recurrent. ai over allegations they diverted technology and business to Moonshot, Reuters reported, ahead of the Chinese AI startup's planned Hong Kong IPO. * Legal dispute: Recurrent accuses Moonshot CEO Yang Zhilin and CTO Zhang Yutao of establishing Moonshot without authorization, misleading investors and enriching themselves at Recurrent's expense. Hong Kong arbitration began in 2024. * Data allegations: Recurrent claims key AI data was transferred to Moonshot in 2023 and other data deleted in 2024. Reuters could not independently verify the allegations. * Compensation: Recurrent received 9.5% of Moonshot's original shares and seeks compensation equivalent to another 10.5%, potentially worth over $700 million. Moonshot was valued at $30 billion in June. * AI business: Backed by Alibaba, Tencent, Meituan and China Mobile, Moonshot develops the Kimi AI models, including its 2.8-trillion-parameter Kimi K3. 11-OCT-2026 07:48 PM ET