| > If they even make it through the discovery process without going bankrupt, which is the explicit, admitted goal of their opponent. No, it isn't. According to Business Insider, this is what was stated: I'm fairly confident we will figure something out eventually, and this won't be a long-term problem. But I think they've got to face the music here. And we're going to have to figure that out unfortunately with a bunch of lawyers. And here's the sad truth. You compare a 100-person company with 10, 30, 40 million dollars in the bank to a two-person startup. If it goes to litigation, if we're wrong, we'll win. Right? We'll win. We'll put a giant law firm on it and we'll do all of the discovery and we'll do all the depositions and we'll win. And if we're right, we'll still win. So it's not a great scenario. If you fork off a startup and there's IP overlap, it's just a big mess. The Smule CEO doesn't at all suggest he's trying to put Shred out of business. Instead, he: 1. Seems to imply that a settlement is possible. 2. Laments the fact that this matter required legal action and that said legal action will put Shred's co-founders in a disadvantaged situation. 3. Acknowledges that this matter is the result of the fact that there seems to be some overlap between the kind of technology Smule creates and the kind of technology Shred creates. Until Smule's claims are known in detail, it's premature to assume that Smule's action has no merit. Smule could be the good guy, or the bad guy. But lots of people here can't help but pick David over Goliath when very few meaningful facts are known. |
Smule has claimed we violated non-solicitation provision in our contract by recruiting each other to start a startup; that we appropriated Smule's code or methods to build Shred Video (though they don't make any specific trade secret claims); That Mark is guilty of fraud in his consulting relationship w/ Smule's engineers (this is detailed our post); and We converted Smule's proprietary information into Shred Video (far as I understand, conversion is a fancy word for "stealing").
The "non-solicitation" claim is laughable, especially in California. The fraud claim is fraudulent itself, as the email record clearly shows Smule itself asked for Mark's help, and he was wholly transparent in the way he provided that help. Everything else comes down to whether we used Smule's proprietary code or methods.
When Smith says "I'm fairly confident we will figure something out eventually...unfortunately...with a bunch of lawyers," seems a reasonable interpretation that "a bunch of lawyers" is code for legal threats, and "figure something out" is code for us paying him (in equity or otherwise) to withdraw the legal threat.