8 ms·

Monster Sues Beats Electronics, Founders for Fraud

35 points by taylorbuley 12y ago

gamesbrainiac 12y ago
Getting past the paywall: http://translate.google.com/translate?sl=ja&tl=en&u=http://www.wsj.com/articles/monster-sues-beats-electronics-founders-for-fraud-1420591462?mod=rss_Technology&utm_source=filos&utm_medium=twitter http://translate.google.com/translate?sl=ja&tl=en&u=http://w...
keehun 12y ago
Can you sue someone for verbally lying to you? If I understand correctly, those typically only apply to libel/slander which does not seem to be the case here.
- ghoney 12y ago
  Can you sue someone for giving you false insider information? "Your honor, I was trying to conspire with these guys to break the law when these guys lied to me, costing me millions! Fraud!! It's fraud I tell you!" The judge should put them all in jail for insider trading.
  - deelowe 12y ago
    Huh?
  - jrs235 12y ago
    Wouldn't that be the kicker? Monster and Lee win their fraud case. Then he SEC charges Lee and Monster with insider trading and win. And the kicker would be, the fine is the $100 million won in the civil fraud case AND (the best kicker) a few years in prison for Lee. Unfortunately, it probably won't happen.
- steakejjs 12y ago
  The answer to "Can you sue?" is always yes, yes, yes. You always can.
- DavidAdams 12y ago
  Fraud. A false representation of a matter of fact—whether by words or by conduct. . .
swang 12y ago
On the one hand (recalling an article that was written about this), it seems Beats was pretty shady in its dealings with Monster, or just straight up tricked them / gained their confidence. On the other hand... > In this case, Monster's Lee argues his specific expertise was something near and dear: cables. "As a company, Monster started when Lee recognized that not all audio cables sound the same," it says. "Lee formed Monster to bring better audio cables to the market, improving the sounds of all speakers, recording consoles, and video systems." sigh Edit: seems the article is linked at the end from Gizmodo...
- sliverstorm 12y ago
  While the spirit of the company is objectionable, none of that is really objectively false. Especially with headphones, whose cables all remain analog.
  - swang 12y ago
    The only difference between a monster cable and a generic cable is the marketing.
    - retrogradeorbit 12y ago
      so... kind of like Apple.
ssttoo 12y ago
Apparently Monster Cable has a history of suing left and right, see http://ttabvue.uspto.gov/ttabvue/v?pnam=Monster%20Cable%20Products,%20Inc http://ttabvue.uspto.gov/ttabvue/v?pnam=Monster%20Cable%20Pr.... or http://madmartian.com/legal/ http://madmartian.com/legal/ E.g. they sued Disney for Monsters Inc, also the job posting site monster.com (which now has a link to monster cable in the footer)...
- jameskilton 12y ago
  Yes Monster Cable is a very shady company, and even though they are a good source of entertainment of just how stupid some of their attacks are, this one could actually be legit. But being such a shady company, I hope this fails and goes nowhere. Poetic justice.
- error54 12y ago
  Holy crap. I count over 100 cases of Monster suing people/companies so I have zero sympathy for them in this case. The real kicker on Monster Cable is that their products aren't even worth the price being outperformed by "inferior" cables costing way, way less[1][2]. [1]-http://gizmodo.com/282725/the-truth-about-monster-cable---grand-finale-part-iii http://gizmodo.com/282725/the-truth-about-monster-cable---gr... [2]-https://www.youtube.com/watch?v=xxfLXH6qe9w https://www.youtube.com/watch?v=xxfLXH6qe9w
- skuhn 12y ago
  They used to be notorious for frivolous lawsuits. I personally found it amusing how badly they got played by Beats, as documented at http://gizmodo.com/5981823/beat-by-dre-the-inside-story-of-how-monster-lost-the-world http://gizmodo.com/5981823/beat-by-dre-the-inside-story-of-h... and elsewhere. My personal favorite example of absurd litigation was their threat to sue Blue Jeans Cable, documented at http://www.bluejeanscable.com/legal/mcp/ http://www.bluejeanscable.com/legal/mcp/. The response from Blue Jeans is seriously awesome.
  - PhantomGremlin 12y ago
    Everyone, stop what you're doing and go read the response from Blue Jeans Cable. Its owner wrote it. He's an ex intellectual property lawyer named Kurt Denke.
threeseed 12y ago
There really needs to be a rule on HN where if the site requires registration then it isn't allowed to be posted. Given that WSJ is now the Fox News of journalism I see no reason to sign up.
- akama 12y ago
  Why do you say that the WSJ is the Fox News of journalism? They have articles that aren't great but for the most part have high quality content.
  - unclebucknasty 12y ago
    I think the GP is referring to a tendency to promote a certain ideology under the guise of news, versus engaging in objective journalism.
    - akama 12y ago
      The editorials are really heavy handed about that, however I've never thought that the news was any more influenced then any other news source.
      - zorrb 12y ago
        To be fair, I thought the point of an editorial was for the author to express their opinion. [1] [1] From dictionary.com: 'Editorial definition, an article in a newspaper or other periodical or on a website presenting the opinion of the publisher, writer, or editor'
        unclebucknasty 12y ago
        I think the difference would be a paper that features editorials which present a diversity of views versus one that seems to editorialize consistently in support of a particular ideology.
    - xux 12y ago
chrischen 12y ago
It sounds like celebrities were given equity in an electronics company to promote it, and later decided to try to take control of the company when Apple expressed acquisition interest.
plink 12y ago
Is this from the same company that owns Greater Hong Kong?
jzwinck 12y ago
> Worried about a lack of transparency at Beats after the HTC deal, Monster CEO Noel Lee also reduced his 5% stake in Beats to 1.25%. This "lack of transparency" probably has a different meaning than the layman's one. The CEO of the former parent company used to be an insider, but no longer is. It's logical that he'd (partially) divest himself, since he no longer has as much "edge" (advantage relative to the market) in his position. In other words, he's not "worried" that Monster will suddenly do something that harms regular stakeholders, he's worried because he is now one of them.
sago 12y ago
When title case confounds, and commas confuse. Took me a while to decypher: Monster sues Beats Electronics founders for fraud.
mikkom 12y ago
And if you want to read the full article, just go through google search (even wsj gives full article via google) https://www.google.fi/search?q=Monster+Sues+Beats+Electronics https://www.google.fi/search?q=Monster+Sues+Beats+Electronic...
csmajorfive 12y ago
> Monster said the change-of-ownership clause triggered by the HTC deal required Monster to transfer all intellectual property to Beats, costing the company millions in lost revenue. Does anyone have more insight into this? Why would they have structured the initial partnership with this clause in place?
fpgeek 12y ago
I'm having a hard time seeing how they're going to prove the Beats / HTC deal was a sham transaction. The partnership went as far as HTC including Beats Audio and/or bundling Beats headphones with some of their phones, which sounds pretty substantive to me. Beyond that, HTC wasn't planning to sell their Beats stake back so quickly - they had to because they ran into unexpected financial trouble.
rertrree 12y ago
I can't access the article. Google translate or links posted by other users don't work. HN please stop supporting paywall sites.
Sarkie 12y ago
Can we sue them back? $150 Monster Cables HDMI versus $15 generic HDMI cable https://www.youtube.com/watch?v=xxfLXH6qe9w https://www.youtube.com/watch?v=xxfLXH6qe9w

35 points by taylorbuley 12y ago

Getting past the paywall: http://translate.google.com/translate?sl=ja&tl=en&u=http://www.wsj.com/articles/monster-sues-beats-electronics-founders-for-fraud-1420591462?mod=rss_Technology&utm_source=filos&utm_medium=twitter http://translate.google.com/translate?sl=ja&tl=en&u=http://w...

keehun 12y ago

Can you sue someone for verbally lying to you? If I understand correctly, those typically only apply to libel/slander which does not seem to be the case here.

ghoney 12y ago
Can you sue someone for giving you false insider information? "Your honor, I was trying to conspire with these guys to break the law when these guys lied to me, costing me millions! Fraud!! It's fraud I tell you!" The judge should put them all in jail for insider trading.
- deelowe 12y ago
  Huh?
- jrs235 12y ago
  Wouldn't that be the kicker? Monster and Lee win their fraud case. Then he SEC charges Lee and Monster with insider trading and win. And the kicker would be, the fine is the $100 million won in the civil fraud case AND (the best kicker) a few years in prison for Lee. Unfortunately, it probably won't happen.
steakejjs 12y ago
The answer to "Can you sue?" is always yes, yes, yes. You always can.
DavidAdams 12y ago
Fraud. A false representation of a matter of fact—whether by words or by conduct. . .

swang 12y ago

On the one hand (recalling an article that was written about this), it seems Beats was pretty shady in its dealings with Monster, or just straight up tricked them / gained their confidence. On the other hand... > In this case, Monster's Lee argues his specific expertise was something near and dear: cables. "As a company, Monster started when Lee recognized that not all audio cables sound the same," it says. "Lee formed Monster to bring better audio cables to the market, improving the sounds of all speakers, recording consoles, and video systems." sigh Edit: seems the article is linked at the end from Gizmodo...

sliverstorm 12y ago
While the spirit of the company is objectionable, none of that is really objectively false. Especially with headphones, whose cables all remain analog.
- swang 12y ago
  The only difference between a monster cable and a generic cable is the marketing.
  - retrogradeorbit 12y ago
    so... kind of like Apple.

ssttoo 12y ago

Apparently Monster Cable has a history of suing left and right, see http://ttabvue.uspto.gov/ttabvue/v?pnam=Monster%20Cable%20Products,%20Inc http://ttabvue.uspto.gov/ttabvue/v?pnam=Monster%20Cable%20Pr.... or http://madmartian.com/legal/ http://madmartian.com/legal/ E.g. they sued Disney for Monsters Inc, also the job posting site monster.com (which now has a link to monster cable in the footer)...

jameskilton 12y ago
Yes Monster Cable is a very shady company, and even though they are a good source of entertainment of just how stupid some of their attacks are, this one could actually be legit. But being such a shady company, I hope this fails and goes nowhere. Poetic justice.
error54 12y ago
Holy crap. I count over 100 cases of Monster suing people/companies so I have zero sympathy for them in this case. The real kicker on Monster Cable is that their products aren't even worth the price being outperformed by "inferior" cables costing way, way less[1][2]. [1]-http://gizmodo.com/282725/the-truth-about-monster-cable---grand-finale-part-iii http://gizmodo.com/282725/the-truth-about-monster-cable---gr... [2]-https://www.youtube.com/watch?v=xxfLXH6qe9w https://www.youtube.com/watch?v=xxfLXH6qe9w
skuhn 12y ago
They used to be notorious for frivolous lawsuits. I personally found it amusing how badly they got played by Beats, as documented at http://gizmodo.com/5981823/beat-by-dre-the-inside-story-of-how-monster-lost-the-world http://gizmodo.com/5981823/beat-by-dre-the-inside-story-of-h... and elsewhere. My personal favorite example of absurd litigation was their threat to sue Blue Jeans Cable, documented at http://www.bluejeanscable.com/legal/mcp/ http://www.bluejeanscable.com/legal/mcp/. The response from Blue Jeans is seriously awesome.
- PhantomGremlin 12y ago
  Everyone, stop what you're doing and go read the response from Blue Jeans Cable. Its owner wrote it. He's an ex intellectual property lawyer named Kurt Denke.

threeseed 12y ago

There really needs to be a rule on HN where if the site requires registration then it isn't allowed to be posted. Given that WSJ is now the Fox News of journalism I see no reason to sign up.

akama 12y ago
Why do you say that the WSJ is the Fox News of journalism? They have articles that aren't great but for the most part have high quality content.
- unclebucknasty 12y ago
  I think the GP is referring to a tendency to promote a certain ideology under the guise of news, versus engaging in objective journalism.
  - akama 12y ago
    The editorials are really heavy handed about that, however I've never thought that the news was any more influenced then any other news source.
    - zorrb 12y ago
      To be fair, I thought the point of an editorial was for the author to express their opinion. [1] [1] From dictionary.com: 'Editorial definition, an article in a newspaper or other periodical or on a website presenting the opinion of the publisher, writer, or editor'
      - unclebucknasty 12y ago
        I think the difference would be a paper that features editorials which present a diversity of views versus one that seems to editorialize consistently in support of a particular ideology.
  - xux 12y ago

chrischen 12y ago

It sounds like celebrities were given equity in an electronics company to promote it, and later decided to try to take control of the company when Apple expressed acquisition interest.

plink 12y ago

Is this from the same company that owns Greater Hong Kong?

jzwinck 12y ago

> Worried about a lack of transparency at Beats after the HTC deal, Monster CEO Noel Lee also reduced his 5% stake in Beats to 1.25%. This "lack of transparency" probably has a different meaning than the layman's one. The CEO of the former parent company used to be an insider, but no longer is. It's logical that he'd (partially) divest himself, since he no longer has as much "edge" (advantage relative to the market) in his position. In other words, he's not "worried" that Monster will suddenly do something that harms regular stakeholders, he's worried because he is now one of them.

sago 12y ago

When title case confounds, and commas confuse. Took me a while to decypher: Monster sues Beats Electronics founders for fraud.

mikkom 12y ago

And if you want to read the full article, just go through google search (even wsj gives full article via google) https://www.google.fi/search?q=Monster+Sues+Beats+Electronics https://www.google.fi/search?q=Monster+Sues+Beats+Electronic...

csmajorfive 12y ago

> Monster said the change-of-ownership clause triggered by the HTC deal required Monster to transfer all intellectual property to Beats, costing the company millions in lost revenue. Does anyone have more insight into this? Why would they have structured the initial partnership with this clause in place?

fpgeek 12y ago

I'm having a hard time seeing how they're going to prove the Beats / HTC deal was a sham transaction. The partnership went as far as HTC including Beats Audio and/or bundling Beats headphones with some of their phones, which sounds pretty substantive to me. Beyond that, HTC wasn't planning to sell their Beats stake back so quickly - they had to because they ran into unexpected financial trouble.

rertrree 12y ago

I can't access the article. Google translate or links posted by other users don't work. HN please stop supporting paywall sites.

Sarkie 12y ago

Can we sue them back? $150 Monster Cables HDMI versus $15 generic HDMI cable https://www.youtube.com/watch?v=xxfLXH6qe9w https://www.youtube.com/watch?v=xxfLXH6qe9w