Former Beats Executive and founder of the streaming music service MOG Inc. is suing Beats Electronics. He filed a lawsuit in the Los Angeles superior court and his claim is that he was unjustly fired for financial gain. His stance is that had he not been fired, he would have owned some equity in the company which was the main cause of firing him from it.
Beats Electronics is currently in the process of being bought by Apple Inc for $3.2 billion. Beats Electronics bought the streaming music service MOG Inc about two years ago.
According to Hyman, he made a deal to sold MOG Inc with the condition that he would be given 2.5% share in the company if Beats reached $500 million market value. He was fired when it looked inevitable that he would get the share, and this prevented him from “receiving the fruits and benefits” of the deal according to his claim.
Hyman’s court filing show that he was fired in a year, before the company could reach the amount set in the agreement. His claim that he was fired so that he would not get his share in the equity may be true. Hyman is trying to get $20 million for Breach of Contract.
The singer Dr. Dre and music producer Jimmy Iovine were not named in the lawsuit, although if they are still owners than it affects them as well.
Rumor has it that Apple is aiming to buy Beats Electronics for $3.2 billion. David Hyman was promised a 2.5% share in the company. A 2.5% share of $3.2 billion would be $80 million. Of course he is asking for $20 Million, which is a lot less if Apple really buys Beats Electronics for the price. Since the music streaming service is also a part of the package, it is included in the overall cost.