New Delhi. Artificial intelligence company Factory AI has removed its board adviser Chris Degnan from his position after CEO Matan Grinberg alleged that Degnan was in continuous, undisclosed communication with the company’s major rival, Cognition, while handling confidential matters for Factory AI. The development drew further attention after Degnan announced just hours later that he was joining Cognition in a new senior role.
Grinberg publicly announced Degnan’s removal from the advisory position. According to the allegations made by the Factory AI CEO, Degnan continued communicating with Cognition despite being involved in confidential and sensitive matters at Factory AI. Factory AI and Cognition both operate in the artificial intelligence software and AI agent space and are regarded as competitors.
FCRF Launches CP-FRM to Build India’s Next Generation of Fraud Risk Professionals
Grinberg alleged that Degnan maintained contact with Cognition during his association with Factory AI without informing the company. The CEO cited this alleged undisclosed communication as the basis for taking action against the adviser. The term “spying” was used in connection with the allegations concerning the purported confidential contact between Degnan and the rival company.
Degnan, however, has rejected the allegations. He denied claims that his interactions with Cognition involved spying or the sharing of confidential information. He has also disputed the account presented by Grinberg regarding his role at Factory AI and his communications with Cognition.
Cognition CEO Scott Wu has also strongly rejected Grinberg’s allegations. Wu said Degnan’s association with Cognition was not part of any alleged spying activity. The dispute has therefore resulted in sharply different accounts from Factory AI on one side and Degnan and Cognition on the other.
The most significant development came within hours of Degnan’s removal, when he announced that he would join Cognition as its Chief Revenue Officer (CRO). In the new role, he is expected to work on the company’s revenue strategy and business expansion.
Degnan’s move to Cognition has attracted attention because he had previously served as a board adviser to Factory AI. His transition between the two competing companies has raised questions about confidentiality, potential conflicts of interest and the movement of senior personnel between businesses operating in the same rapidly developing AI market.
No detailed independent evidence supporting Factory AI’s allegations has been publicly established in the information available. Degnan and Cognition’s CEO have both rejected the spying allegations. As a result, the dispute currently rests largely on conflicting claims and statements from the parties involved.
The AI industry is witnessing intense competition for experienced executives, technical talent and business leadership. Movement of employees, advisers and executives between competing companies can occur in such an environment. However, when an individual has access to confidential commercial information, such transitions can raise additional questions regarding confidentiality obligations, contractual restrictions and potential conflicts of interest.
Degnan’s appointment at Cognition has therefore turned the dispute between the two AI companies into a broader issue involving confidentiality and potential conflicts arising from movement between competitors. Based on the publicly available information, there has been no independent confirmation of any transfer of confidential information or of actual spying activity.
About the author — Suvedita Nath is a science student with a growing interest in cybercrime and digital safety. She writes on online activity, cyber threats, and technology-driven risks. Her work focuses on clarity, accuracy, and public awareness.
Follow for daily updates on cybercrime, corporate fraud, DFIR, hacking, investigations, and digital forensics
