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Monster files suit against Beats Electronics, HTC for fraud (update)

Monster files suit against Beats Electronics, HTC for fraud (update)

Taipei, Jan. 8 (CNA) Taiwan's HTC Corp. has been listed as a defendant in a complaint filed by audio equipment firm Monster Inc. against Apple Inc.'s Beats Electronics. The complaint claims that the co-founders of the high-end headphone maker committed fraud and duped industry knowledge away from Monster, which designed and made the headphones for Beat before HTC gained a majority share in the California company, which was later bought entirely by Apple. The lawsuit, filed Tuesday in the San Mateo County Superior Court, argued that Beats co-founders Dr. Dre and Jimmy Iovine hid the role of Monster and its CEO Noel Lee in engineering the headphones when HTC acquired a 51 percent stake in Beats in 2011 for US$300 million. Only a year later, the HTC-Beats partnership ended and Dre and Iovine reacquired 25.5 percent of Beats, allowing them to exercise a change of ownership clause that effectively severed ties with Monster, the complaint says. Monster indicated it believes the HTC investment was "a sham" and an act of "corporate betrayal" that made the manufacturer lose out on hundreds of millions of dollars when Dre and Iovine sold Beats to Apple last year for US$3.2 billion -- by far Apple's largest acquisition to date. HTC sent a brief statement by email to CNA later Thursday.
"We cannot comment on litigation pending before the court," it said. (By Jeffrey Wu)


Updated : 2021-09-25 11:53 GMT+08:00