Founder of now shuttered music service MOG David Hyman is suing Beats Electronics for upwards of $20 million, according to a lawsuit filed yesterday. Hyman joined Beats after the company purchased the MOG streaming music service back in 2012, which eventually evolved into the current Beats Music service. Hyman said he was fired after trying to get rid of a “problematic” employee a bit less than a year after the MOG acquisition. Under Hyman’s contract, Beats agreed to pay him 2.5 percent of current equity — with 1 percent of that due after his first year with the company. However, since he was fired before that time, Hyman never got that equity.
Just as Apple is expected to close on a deal with Beats Electronics as soon as next week, a new report from The Wrap shares that David Hyman, the founder of music service MOG which Beats purchased, is suing the headphones and streaming music company for at least $20 million plus interest. “The suit claims that, under an incentive plan adopted during Hyman’s tenure, he would be entitled to compensation including 2.5 percent of the company’s “currently outstanding equity interests,” with 1 percent due on the first anniversary of Hyman’s date of employment, and subsequent installments due in subsequent months. The suit also claims that he was promised a grant of 25 percent of the company’s outstanding equity interests following adoption of the incentive plan if the company achieved a fair market value of $500 million or more.”
