Business News Legal

Judge kicks out much of Monster’s case against Beats

By | Published on Wednesday 31 August 2016

Beats by Dre

A judge has dismissed a number of allegations made against Beats and its co-founders Dr Dre and Jimmy Iovine by Monster LLC, an early partner in the ‘stick-a-by-Dre-label-on-the-side-and-hike-up-the-price’ headphones business.

As previously reported, tech company Monster and the then independent Beats ended their alliance in something of a messy divorce in 2012. Then last year, after Apple had bought the headphone firm and its fledgling streaming service in a $3 billion deal, Monster sued.

The firm accused Beats of some dodgy dealing around its previous share sale to phone maker HTC, which Monster said was deliberately structured to enable Beats to exercise a change of ownership clause in its contract with Monster LLC in order to end the two companies’ business partnership.

Monster founder Noel Lee also claimed that he had been misled by Beats management about future plans, meaning he sold his stake in the Beats company in 2013, netting much less than if he’d waited for the Apple deal a year later.

But, according to Billboard, in a summary judgement, the judge hearing the case concludes that Beats’ actions were allowed under its contracts with Monster and Lee, while also noting that both had entered into deals with the Beats business as “sophisticated investors”.

The summary judgement means that a scheduled court hearing will now only consider efforts by Beats to force Monster to cover its legal costs.