Monday, December 7, 2009

What's the other other side of the FusionGarage - TechCrunch dustup?

You'll recall that LAST Monday, I wrote a post entitled What's the other side of the FusionGarage - TechCrunch dustup?. I quoted from the November 30 TechCrunch post on the topic, which said, in part:

We chose to work with Fusion Garage on Prototype C and the launch prototype after we finished Prototype B internally.

We jointly own the CrunchPad product intellectual property, and we solely own the CrunchPad trademark.

So it’s legally impossible for them to simply build and sell the device without our agreement.

At the time, however, I found a January 2009 post from Fusion Garage that had a different interpretation of Prototype B.

There is an air of excitement permeating through Fusion Garage at the moment. Michael Arrington of Techcrunch just wrote an update on the Techcrunch Tablet Prototype B.

It’s our software that is running on the tablet as demonstrated in the videos embedded in the article.

So I was wondering what the other side of the story was, from Fusion Garage's perspective. And a week later (Monday, December 7), the Inquisitr posted the following:

Rathakrishnan explained that Fusion Garage had solely developed the products OS without a single line of code being provided by TechCrunch, while also hiring their own employees to develop the products hardware and ultimately finish the complete product. As he put it “Fusion Garage is the actual only doer in this story.”

Read the rest here. Inquisitr writer James Allen Johnson concluded by saying:

Given this recent round of information it should be interesting to see how TechCrunch and more specifically Michael Arrington decide to fire back, from my point of view Fusion Garage should have an Epic Win on their hands.

As it turns out Arrington fired back before Fusion Garage fired. See this December 4 post:

[T]hey have spoken to press, and say that their side of the story has two key elements. First, that none of this was a surprise and we knew they were likely to break ties with us. And second that TechCrunch hasn’t done anything to help build the CrunchPad and therefore has no rights to the device.

Both statements are completely untrue. Among other things, emails from Fusion Garage illustrate it.

And Arrington repeats the claim of joint ownership of intellectual property:

There is just no way to argue that TechCrunch is not the joint owner of all intellectual property of the CrunchPad, and outright owner of the CrunchPad trademark. The CEO of Fusion Garage has spent nearly six months this year working from Silicon Valley and our offices. Most of the Fusion Garage team has spent the last three months here working with our team on the project. And our key team members have spent time in Singapore working directly on the hardware and software that powers the device. Fusion Garage emails and their own blog, before it was deleted, acknowledge this. We have also spent considerable amounts of money creating the device, paying the vendor and other bills that Fusion Garage wasn’t able to.

So, as I noted in my post from last week, there are conflicting views regarding who owns what. Couple that with the claims by both sides that they had to pay for something because the other side wouldn't, and you have a big mess on your hands.

This is especially messy because both hardware and software are involved. When IBM engaged Microsoft to provide an operating system for its personal computer, Microsoft didn't try to claim ownership of the hardware IP. When Google looked for phone manufacturers to use its Android OS, Google didn't try to claim ownership of the phone IP. And as for Apple, they are well-known for producing both the hardware and the software under their own banner, so the issue of who owns what never applies.

In the ideal world, TechCrunch and FusionGarage would have completed a statement of work that clearly delineated who would do what, and who would own what. From the things that have been said over the past week, and the things that haven't been said, it's becoming clear that no single document exists.

So where are we left? TechCrunch's blog post title declares litigation imminent. Meanwhile, the sale of JooJoo devices is also imminent, and is supposed to go forward this Friday, December 11. Expect every lawyer in the Bay Area to be busy on this matter this week - unless, of course, Tiger Woods has a girlfriend in Sausalito.
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