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Arrington Responds To the JooJoo, Files Suit
itwbennett writes "Not normally 'one to enjoy a casual read of a lawsuit,' blogger Peter Smith admits to finding the suit Michael Arrington is filing against Fusion Garage over the JooJoo (nee CrunchPad) fascinating. 'Skip to page 4, starting with item 11,' says Smith. 'At this point I don't know what to think, Every time I get close to pretty much accepting Arrington's story at face value, he pulls something that makes me stop and reexamine his arguments.' For example, says Smith, in one bullet point in Arrington's latest salvo, he calls out the press, saying 'it is irresponsible for press to link to the pre-sale site.' 'This attempt to directly sway the press away from Fusion Garage really spikes my suspicion meter' says Smith. 'After all, Arrington is the press. If I started writing screeds advising him on what he should or should not say about a product, what would he think?'"
He already has a reputation as a pompous ass. Now he has a reputation as a lazy, dishonest, litigious pompus ass.
...is Arrington laying it on a bit thick, firing every bit of ammo he can muster?
That's what you're supposed to do in a lawsuit. You throw whatever you can and see what sticks.
The quote in the summary about not wanting press to link to the pre-sale site is a bit out of context. The full quote makes slightly more sense:
Fusion Garage’s financial situation is a mess, and it is inappropriate for press to recommend to people to pre-buy a CrunchPad. The company has not yet hired an attorney to respond to our lawsuit. We believe they do not have the cash flow to do so. When the device goes on pre sales today, linked to from scores of gadget and press sites, they will suddenly have cash flow to defend themselves. What they won’t have is cash flow to build the devices. We believe it is irresponsible for press to link to the pre-sale site without disclosing this to readers.
Michael Arrington was involved in a project for the CrunchPad, a Linux-based tablet PC designed for Web surfing. Magazines such as Wired and Forbes have named Arrington one of the most powerful people on the Internet due to his TechCrunch blog. There was much hype on the product, being reatured in The Business Insider , Popular Mechanics and the Washington Post. On November 30, 2009, Arrington reported that CrunchPad project had ended due to disagreements between himself and the Fusion Garage team, but on December 7, 2009, Fusion Garage CEO Chandra Rathakrishnan announced that the CrunchPad would be released by the company as the Joo Joo, and that it will go on sale December 11, 2009 for $499 USD. Hilarity ensued.
Only there's no such thing as generic IP, and there's no such thing as "IP theft", and in any event, he's not suing over THAT, he's suing over the trademark "CrunchPad", which they don't appear to be using.
ASCII stupid question, get a stupid ANSI
I think Gizmodo said it right in this article http://gizmodo.com/5424261/the-crunchpadjoojoo-lawsuit-has-been-filed-preorders-are-officially-a-gamble "if Arrington's lawsuit has even a hint of truth to it regarding the lack of lack of Fusion Garage's sound capital resource—is no longer an option for the sane or even marginally patient. I mean, just wait til it ships and gets reviewed before giving these guys any money, ok?" One, I wouldn't put 500 bucks down on a device that is a web browser, and looks like e-ink. I want something very fresh. I've never owned an apple product, but if the rumored tablet is real, and is off the charts, I'll buy it. Otherwise I'm going to wait a year to see what other products come to light.
Arrington: tech blogger/commentator/etc.
TechCrunch: his site:
CrunchPad: Arrington's idea for a cheap, tablet device that used a browser OS to do basic web stuff. He wanted it to cost ~ $200.
FusionGarage: The company Arrington's group partnered with to develop the OS & do some of the hardware integration work.
JooJoo: the name that FusionGarage released the CrunchPad under when they tried to go solo, ditching Arrington.
I agree. I seem to remember Arrington posting rumors about last.fm handing user data over to the RIAA back in February, and then AGAIN in May. As far as I know, both of these rumors turned out to be false. He never said anything about his source, just that it was a very trustworthy one, and he never posted a retraction. He did, however, make a post in May ridiculing last.fm because its servers overheated and were taken offline.
So I'm not a law talking guy either but I did read the lawsuit and he's suing them under more than just the Lenham act.
First, Under Lahnam he's suing theme for false advertising that damaged TechCrunch
Second, Under California law he's suing them for "breach of fiduciary duty" claiming they violated an implicit partnership which is formed automatically under CA law (according to the lawsuit)
Third (I assume also under the California partnership theory) he's suing for "misappropriate of business ideas" and claiming that Fusion Garage doesn't own the IP but rather that the partnership does.
Forth, he's suing them for fraud under CA law claiming they were basically liars and thieves.
Fifth, he's claiming "unlawful business practices and false advertising" under CA law. (which I assume is similar to the first cause for action but under the CA state laws that are relevant rather than the Lanham Act)
It then goes on to say what should be done to make things right, demand a jury trial, and file some "exhibits". I'm not pro or con one way or the other but it's not as simple as he's filing suit under a trademark law so he doesn't have a chance and again, IANAL.
Arrington isn't suing for breach of contract. He isn't suing for on any grounds related to the IP. To me, this suit is simply intended to sic legal costs on Fusion Garage since they backed out of whatever verbal or implied deal that they had with Arrington, and he's mad about it. The claims aren't frivolous, but they're pretty weak, and not what Arrington has said the actual problems were.
Trade secrets are only protected if they are held secret. In order to hold something secret when shared with a third party, they must sign a non-disclosure agreement.
Thus, if they are trade secrets, he should be suing for contract violations. If they are copyrights, such as on source code or one a printed circuit board, he should be suing for copyright violations.
In neither case will a trademark suit help, and if he's released the source code as open source, and the vendor takes the time to respin the PCB to have a slightly different schematic and layout, and all the contracts were "verbal" with no documentation, he's left with nothing at all.
It doesn't hurt to be nice.
I read the lawsuit. IANAL, et. al., but it seems to come down to a fundamental question: Did TechCrunch materially contribute to the production of the Crunchpad (nee JooJoo)? Arrington lays out pretty convincing arguments. He notes the idea was conceived and developed to at least the point of Prototype A without the involvement of Fusion Garage at all. Then, at various points, TC directly paid money owed by FG, as well as providing a place for them to stay when FG's development team flew out to SF to work with TC. He (quite rightly) asserts that there is no reason for FG to have flown to the states if they indeed were the sole developers of the CP. There are some ancillary points (false advertising for the JooJoo that it's FG's to sell, solely developed, misrepresentation by FG that they were developing a browser-based OS [they weren't], and a few other misrepresentation claims), but reading the e-mails attached as exhibits there is another strange thing. There are two competing narratives here: One, advanced by Arrington, is a joint project. The other, advanced by FG CEO Chandra Rathakrishnan, argues that FG developed the entire thing. CR's version has been repeated to the press as well as in private e-mails to his investors -- which were sent after he agreed (via e-mail) for FG to be acquired by TC for 35%, at least 5% lower than he would have preferred. Thus far, I haven't read of any evidence that FG's story is correct, and there is nothing that refutes the assertions made by Arrington. Thus, for now, I have to come down his side. But hopefully the court case will make everything clear.
AFAIK, he initiated the project, hired engineers (hw & sw), generated masses of publicity through his blogs and business network, hosted FG people at his offices, allegedly made all sorts of distribution deals.. and presumably spending considerable sums in the process. Seems like he (and his company) did rather a lot and was the prime (and very public) driving force from the start.
FG's own blog apparently gave credence to Arringtons version which is probably why they took it down.. unfortunately for them the 'incriminating' posts still exist on google cache and likely many other places. Oops.
However FG have Bruce Lee on their side so it will be a tough fight.. Arrington may need to call in Chuck Norris for some roundhouse support.
If Arrington did have the engineers in his employ, then he'd own the IP and FG wouldn't be able to push him out. Everything I've read has said FG did the engineering.
That just leaves the publicity from his blog and other touchy feely marketing somesuch. 35% seems well and above reasonable for that.