Monster's claims that Beats Electronics fraudulently ended their relationship were dismissed in a Los Angeles Superior Court today, leaving Beats and Apple off the hook. The judge ruled that Beats was allowed to end their partnership, meaning its actions were not, as Monster and its CEO Noel Lee claimed, a "sham" designed to take control of their shared headphone line.
The case continues, but not in a way that Monster's going to be happy about: Beats is now countersuing for attorneys' fees, claiming its termination agreement with Monster should have prevented this lawsuit — or really any other lawsuit — from being filed in the first place. Apple declined to comment, and Monster attorney Philip Gregory did not return a request for comment.
Monster essentially says Beats ran off with its work
Monster and Lee filed the suit in January of 2015, essentially arguing that it invented Beats only to have Dr. Dre and Jimmy Iovine steal the headphones away from them. Monster had been a close partner of Beats during those first few years, with Monster handling manufacturing, as well as, it claims, engineering, marketing, and distribution. Beats cut off ties to Monster in 2011, shortly after HTC took a controlling stake in the company. Monster, for whatever reason, claims this didn't really happen and was just an excuse to trigger a contract clause letting Beats go free.
But the ruling today suggests that determination was up to Beats and that Monster had little if any say in the matter. The judge writes, "Monster agreed that Beats had the right to terminate the agreement as of January 7th, 2013 or when there was a transaction resulting in a change of control of Beats. [Monster] did not obtain the right to approve the change of control. Nor did the agreement require that any change of control had to be objectively reasonable." The judge also dismissed claims that HTC aided in the supposed breach of contract.