Andy Rubin and Tony Fadell go head-to-head in Essential lawsuit
Andy Rubin’s Essential has gotten off to a pretty rocky start. Its flagship smartphone was shipped weeks late, then it lost a couple of high-level executives, while actual sales of its Essential PH-1 smartphone have been less than stellar. Now Rubin’s startup is embroiled in a lawsuit brought on by Keyssa Inc, which has the backing of Nest co-founder and father of the iPod, Tony Fadell.
Keyssa is has been developing a new wireless chip since 2009 that supports high data bandwidth without using either Wi-Fi or Bluetooth wireless spectrums. Essential had been interested in using Keyssa technology and had engaged with its executives and up to 20 engineers over a 10-month period, Keyssa alleges. However, Essential decided to use a competing product produced by SiBEAM. Essential, as we know, launched its Essential PH-1 smartphone in September with the ability to connect to modular peripherals wirelessly.
Although Essential uses the SiBEAM chip, Keyssa alleges that Essential gave away trade secrets that ended up in SiBEAM’s solution. “Keyssa has not been compensated for Essential’s use of this guidance and know-how,” the company said in a statement to Reuters. “We are pursuing this action because our attempts to resolve this matter through discussions with Essential have not been successful.”
If you are familiar with the HBO comedy “Silicon Valley,” you will no doubt recognize the circumstances of this real-life lawsuit reflect an episode from the series. In the show, the main character Richard Hendricks of the fictional startup Pied Piper shops around his middle-out compression algorithm technology to would be investors. Unfortunately, he latter learns that he had been unwittingly giving away his IP to them, who then drop him and try to recreate his technology without him (and, naturally, without paying for it).
It looks like this could be a case of life imitating art.