The Founder Of Music Streaming Service MOG Is Suing Beats Electronics For $20 Million
Hyman claims he was fired so Beats could avoid giving him an equity payout.
Beats purchased MOG in 2012 for an undisclosed amount and kept Hyman as CEO along with the entire MOG team.
But Hyman was fired within a year of the acquisition for trying to terminate a problematic employee, according to the lawsuit, which said Beats also fired him to avoid giving him the payout.
MOG eventually became Beats Music, the streaming music service that launched in January.
The lawsuit is especially relevant as Apple prepares to buy Beats Electronics for $3.2 billion. In theory, Hyman would miss a big cut of that acquisition since he says he lost his equity in MOG.
The lawsuit claims Hyman would have been entitled to 2.5% of the company's "currently outstanding equity interests," with 1% paid out after Hyman had been at the company for a year, and the rest paid out over the next few months.
The suit also claims that Hyman was promised 25% of the company's outstanding equity interests if the company achieved a valuation of $500 million or more.
We've reached out to both Beats and Hyman for comment.
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