Beats music service sued by former executive amid possible sale to Apple

Sat May 17, 2014 8:22am IST

The Apple logo is pictured on the front of a retail store in the Marina neighborhood in San Francisco, California April 23, 2014. REUTERS/Robert Galbraith/Files

The Apple logo is pictured on the front of a retail store in the Marina neighborhood in San Francisco, California April 23, 2014.

Credit: Reuters/Robert Galbraith/Files

Related Topics

Stocks

   

REUTERS - Beats Electronics, which is close to being sold to Apple Inc for $3.2 billion, has been sued by the founder of a music service Beats bought two years ago claiming he has been cheated out of his share of the company.

David Hyman, the founder of the music subscription service MOG Inc, filed a lawsuit on Wednesday in Los Angeles superior court claiming he was purposely terminated so that Beats could avoid granting him his equity stake in the company.

Hyman claims that as part of the agreement Beats made to buy MOG in 2012, he would have been granted, over a period of time, 2.5 percent of the outstanding equity interest in Beats if the company reached a market value of $500 million or more. But Hyman was terminated less than a year after the deal, which prevented him from "receiving the fruits and benefits" of the transaction, according to the lawsuit.

The lawsuit, which makes claims for breach of contract, is seeking $20 million in damages.

A Beats spokeswoman had no comment.

Rapper Dr. Dre and legendary music producer Jimmy Iovine, the founders of Beats Electronics, were not named in the lawsuit.

(Reporting by Andrew Longstreth in New York; Additional reporting by Lisa Richwine)

FILED UNDER:
Photo

After wave of QE, onus shifts to leaders to boost economy

DAVOS, Switzerland - Central banks have done their best to rescue the world economy by printing money and politicians must now act fast to enact structural reforms and pro-investment policies to boost growth, central bankers said on Saturday.

Obama In India

Reuters Showcase

Australian Open

Australian Open

Serena avenges French Open loss to reach quarter-finals.  Full Article 

Miss Universe

Miss Universe

Miss Colombia is crowned Miss Universe for 2015.  Full Article 

SAG Awards

SAG Awards

'Birdman' wins top honor from actors in march toward Oscars.  Full Article 

Banking Revolution

Banking Revolution

India turns to corner shops, mobile phones for banking revolution.  Full Article 

Climate Change

Climate Change

U.S.-China climate deal does not put pressure on India, says Modi  Full Article 

Bangladesh Politics

Bangladesh Politics

Bangladesh charges opposition chief with instigating attack on bus  Full Article 

Box Office

Box Office

Eastwood's "American Sniper" continues as U.S. box office juggernaut   Full Article 

Boko Haram Fight

Boko Haram Fight

Nigeria repels suspected Boko Haram attack on Maiduguri city  Full Article 

Akshay Kumar's Latest

Akshay Kumar's Latest

"Baby" is a smartly written, well-acted film  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage