Dr. Dre, Jimmy Iovine And Beats Music Hit By Monster Lawsuit
It's safe to say Dr. Dre and Jimmy Iovine had a pretty awesome 2014 thanks to Apple's $3.2 billion acquisition of Beats Electronics. However, tech company Monster is here to rain on their parade with a hefty lawsuit. According to the Wall Street Journal, Monster LLC and its CEO Noel Lee have sued Dre, Iovine, Beats Electronics LLC and Taiwanese smartphone maker HTC Corp. for fraud.
Just a little bit of background information: Monster helped launch the Beats headphones way back in July 2008. In the claim, which was filed in San Mateo County Superior Court on Tuesday (Jan. 6), Monster alleges that the headphones were originally a joint venture, but the Beats creators conspired to steal the audio engineering Monster built for them.
Monster says that the headphone line was "fraudulently acquired" in sham 2011 transaction with HTC, where they purchased a 51% stake in Beats for $300 million. Then, Beats allegedly bought back 25.5% of its own shares within a month of the deal closing. This allowed Beats to terminate the Monster relationship due to a "change-of-ownership clause."
After that, Monster's success slowly began to dwindle. “A terrible situation took place that basically robbed Mr. Lee of his invention,” Lee’s attorney Joe Cotchett told Forbes.
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