Integrity has become the theme of Silicon Valley’s hottest congressional race between Rep. Ro Khanna and his challenger, Ethan Agarwal, who’s ripped into Khanna over family ties to stock trading.
Yet questions are emerging about Agarwal’s own past as a tech company founder — dogged by millions of dollars in legal debts, defaulted payments and alleged unpaid business rent.
Court records show Agarwal — who previously lived in New York — personally confessed in 2020 to owing $2 million to Universal Music Group over a licensing dispute with the digital fitness company he founded, Aaptiv. Later filings show Agarwal failed to pay $300,000 of the settlement he agreed to a year before selling the company in 2021. Separately, the landlord of One World Trade Center in New York City sued Agarwal’s company in 2023 for $2 million over unpaid rent while he was CEO, though proceedings were discontinued the same year. The court records in New York leave the outcome of the lawsuits unclear.
Agarwal said the money’s been paid.
“I ran a company that was worth $300 million 10 years ago,” he told San José Spotlight. “You get sued all the time and you settle those lawsuits, and every single one of the things that you mentioned was settled.”
Representatives for One World Trade’s landlord and Universal Music Group did not respond to questions about whether Agarwal paid out the money he allegedly owed.
“When a documented record includes unpaid obligations, a confessed judgment and a subsequent default on that very settlement, that’s not a single incident. That’s a pattern that persists even after legal compulsion,” Davina Hurt, director of the government ethics program at Santa Clara University Markkula Center for Applied Ethics, told San José Spotlight. “The first question voters should ask isn’t, ‘What does this candidate promise to do?’ It’s, ‘When this candidate made a promise before, did they keep it?’”
Agarwal — who moved to Palo Alto from New York in 2020, according to court records — previously hopped into the California gubernatorial race last year, couching himself as a Democrat “who believes in capitalism.” He dropped out in favor of the Congressional District 17 seat earlier this month, after Khanna’s support for a California billionaire tax proposal ruffled feathers with Silicon Valley’s wealthy tech elite.
The former New Yorker was among the tech industry figures to lambast Khanna’s position, and has made ethics and public integrity a tentpole of his congressional challenge. Yet Agarwal faces an uphill battle — his opponent is now a well known name balancing dual reputations as a friendly face to both the tech industry and America’s progressives.
Congressional District 17 covers parts of Alameda and Santa Clara counties, including Sunnyvale, Cupertino, Santa Clara, Milpitas and the northern and western parts of San Jose. The district is home to multiple Silicon Valley headquarters, including Apple, Intel and Yahoo.
While Agarwal aligns with Democrats on gun control and pro-choice abortion stances, he has joined the opposition to California’s billionaire tax proposal, arguing it will drive out the rich and burden the middle class. His congressional campaign platform also includes creating public health care options to compete with private insurers and expanding Medicare’s ability to negotiate lower drug prices.
A 40-year-old political newcomer, Agarwal frequently attacks Khanna online for standing out among congressional colleagues in stock trades. California Common Cause reported Khanna made more than 4,000 trades — with a total volume of $55.7 million — in 2025, ranking third in a list of the year’s top 10 congressional traders.
Khanna, 49, has co-sponsored congressional stock trading reforms, authored a resolution calling for a ban and publicly maintained he doesn’t personally own or trade any individual stocks. He has said the trades belong to his wife, whose premarital assets are in an independently managed trust.
Agarwal said questions about his legal past pale in comparison to ethical questions Khanna faces.
“Aside from the stock trades, I would point voters to a 2022 New York Times article that shows Ro Khanna had 149 conflicts of interest between the committees he sits on,” Agarwal said. “I was not representing public citizens (at the time of the Aaptiv lawsuits). And those happened eight years ago.”
Agarwal has vowed to ban stock trading by congressional leaders and their family members if elected. Court records show he was married for nearly 10 years until filing for divorce in 2025. Agarwal declined to comment on his marriage separation.
“I’ll be divesting my personal account, pushing for a ban on stock trading by members of Congress and their families, and fighting for term limits,” Agarwal wrote on X on March 3.
Khanna’s campaign maintains Agarwal is “launching baseless personal attacks” against the congressman.
“The lies Ethan is spreading about Ro are sad, but also deeply hypocritical given his checkered financial and personal past,” Khanna’s spokesperson Sarah Drory told San José Spotlight. “We should have a conversation in our district and California about real ideas and plans to improve the lives of people in the community.”
Hurt said legal woes are common for entrepreneurs — and they alone don’t define character.
“One or two lawsuits can be unfortunate circumstances. Three begins to look like a pattern and patterns are exactly what voters should be paying attention to,” Hurt said. “Does a candidate’s history of honoring or not honoring financial and legal obligations tell us something meaningful about how they would handle public trust and taxpayer resources?”
John Sims, a professor emeritus at the University of the Pacific’s McGeorge School of Law, has the same questions.
“We don’t know all the details of this, but if someone is repeatedly involved in disputes of this sort where they’re accused of not telling the truth or living up to their obligation and not holding up to a settlement, what does that tell me about your character?” Sims told San José Spotlight. “The other thing I wonder about is, what does it say about your motivations for running?”
Contact Brandon Pho at [email protected] or @brandonphooo on X.