Apple Inc. Cancels Deal With Monster, Accused Of Bullying

Apple Inc. Cancels Deal With Monster, Accused Of Bullying
<a href="">ElisaRiva</a> / Pixabay

Apple has ended its licensing deal with Monster to manufacture authorized accessories for the iPhone, iPad and iPod. Now Monster is alleging that Apple is acting like a “bully” and stated that the terminated agreement is the direct result of its own lawsuit targeted at Beats, which Apple bought last May, says a report from The Wall Street Journal.

Apple acting like a “bully”

Monster previously sued Beats, claiming co-founders Dr. Dre and Jimmy Iovine gradually sidelined the hardware company, which was once a major manufacturer of Beats headphones, on the backdrop of a $3 billion deal with Apple. In the lawsuit, Monster and its CEO, Noel Lee, accused Beats and its co-founders of depriving the company of potential proceeds from the company’s sale to Apple. The lawsuit is concerned with the change of ownership clause that went into effect when Beats bought back its own shares from HTC, which Monster slammed as a “sham transaction.”

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Now Monster claims that Apple is acting like a bully over the approaching legal battle and is in a hurry to end the years-long relationship between the companies. According to The Journal, Monster noted that the move will “significantly disrupt” its business, as approximately 900 of Monster’s 4,000+ products are a part of Apple’s MFi program. With Apple ending the MFi agreement, Monster will need to modify its packaging and redesign some of its products to avoid using the licensed technology.

Apple overreacting, feels Monster

What disturbed Monster is the reaction of Apple’s board even though the former did not sue the company directly. Monster said that Apple is taking extreme action by ending the agreement, adding that Apple “inherited” the fight by purchasing Beats. David Tognotti, Monster’s general counsel, told The Journal, “It shows a side of Apple that consumers don’t see very often.” Tognotti also said that Apple has paid $12 million in MFi licensing fees since 2008.

Monster usually manufactures licensed cables, car chargers, cassette adapters and other items. The company is popular for selling overpriced products. Although the company can keep selling its MFi products until September, it has been instructed not to manufacture any new units.

The lawsuit, which was initially filed in San Mateo County, Calif., is pending in Los Angeles County Superior Court. As of now, there is no comment from Apple on the matter.

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