
Monster Sues Beats Electronics, Founders for Fraud - taylorbuley
http://www.wsj.com/articles/monster-sues-beats-electronics-founders-for-fraud-1420591462?mod=rss_Technology&utm_source=filos&utm_medium=twitter
======
ssttoo
Apparently Monster Cable has a history of suing left and right, see
[http://ttabvue.uspto.gov/ttabvue/v?pnam=Monster%20Cable%20Pr...](http://ttabvue.uspto.gov/ttabvue/v?pnam=Monster%20Cable%20Products,%20Inc).
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)...

~~~
skuhn
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-h...](http://gizmodo.com/5981823/beat-by-dre-the-inside-story-of-how-
monster-lost-the-world) 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
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.

~~~
slouch
[http://www.bluejeanscable.com/legal/mcp/response041408.pdf](http://www.bluejeanscable.com/legal/mcp/response041408.pdf)

~~~
plink
That. letter. is. glorious.

------
swang
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
While the spirit of the company is objectionable, none of that is really
objectively false. Especially with headphones, whose cables all remain analog.

~~~
swang
The only difference between a monster cable and a generic cable is the
marketing.

~~~
retrogradeorbit
so... kind of like Apple.

------
gamesbrainiac
Getting past the paywall:

[http://translate.google.com/translate?sl=ja&tl=en&u=http://w...](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)

------
jzwinck
> 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.

------
mikkom
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+Electronic...](https://www.google.fi/search?q=Monster+Sues+Beats+Electronics)

------
fpgeek
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.

------
csmajorfive
> 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?

------
chrischen
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.

------
Sarkie
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)

------
keehun
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
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.

~~~
jrs235
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.

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

------
sago
When title case confounds, and commas confuse. Took me a while to decypher:

Monster sues Beats Electronics founders for fraud.

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

------
threeseed
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
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
I think the GP is referring to a tendency to promote a certain ideology under
the guise of news, versus engaging in objective journalism.

~~~
xux
Isn't that most news organizations these days? There's no arrangement of facts
that is completely neutral. You have to lean one way.

~~~
unclebucknasty
> _Isn 't that most news organizations these days?_

Seems so. But, I think it's a question of relative degree. For instance, the
comment to which I was responding seemed to take exception to the WSJ
comparison with Fox News. That's a tacit acknowledgment of a certain belief
about Fox News and their degree of bias.

> _There 's no arrangement of facts that is completely neutral. You have to
> lean one way._

Well, the phrase "arrangement of facts" is a bit loaded in that it suggests a
manipulation of facts, so given that premise, yeah, the objective would
seemingly be to "lean". However, I don't see any reason that the mere
presentation of facts _must_ lean in any direction.

But, maybe it's just a testament to how far gone we are in this age of
infotainment that it's hard to even imagine that facts can be presented
without bias.

~~~
Portan
Without arrangement and bias, journalism would have no value. Searching for a
random word on Google will give you a pile of facts but it's not interesting.
People want to read something interesting to them. So it must be biased in a
way they'll be interested in. Whether that's "dodgy company gets its
comeuppance", "my favourite party does something good" or "person dies in an
accident".

~~~
unclebucknasty
> _Without arrangement and bias, journalism would have no value._

I don't know about that. Truth is stranger than fiction and there's plenty of
interesting information to be had. Editorializing and slant can be juicy, but
good writing/presentation is timeless. Likewise, curating and clearly
presenting information of interest has tremendous value to many; potentially
even more so when it's clear that there is no bias.

> _" dodgy company gets its comeuppance", "my favourite party does something
> good" or "person dies in an accident"._

Those could just as easily be fact-based reporting on topics of broad
interest. No bias is needed in delivering such factual content to make it more
compelling. For instance, replace those "headlines" with:

"Facebook loses court challenge over privacy violations"

"Republican party donates clothes to shelter"

"Princess Diana dies in car accident"

