Startup beats Best Buy in Court

Sometimes the "little guy" wins--but startups beware--

The defunct startup that beat Best Buy in court - The Term Sheet: Fortune's deals blog Term Sheet: "Best Buy found liable of stealing corporate secrets, in a case funded by venture capitalists - . . . Fast forward a few months and many more meetings in Minneapolis. Best Buy abruptly tells Techforward that it is not moving forward with them – but rather, they are moving forward themselves. They launch a Super Bowl commercial staring Ozzy Osbourne and Justin Bieber to promote their program. And Best Buy goes on to generate over $140 million in revenues through this program. Now imagine the scene in the Techforward board room. Although the company had been providing services for other retailers (like Radio Shack and Dell), the company had invested well over a year's effort to get the Best Buy deal underway. And Best Buy's last minute actions posed a fatal blow. Techforward sued Best Buy – but it would take a very long time before the case made it through trial. And since Techforward had invested so much money working on the Best Buy deal, the cash position of the company was not looking good. The board ultimately had to make a horrible choice – they sold Techforward's assets to a third party. BUT – they did not sell the lawsuit. . . . after 18 months in court, a nine-person jury found Best Buy liable for misappropriation of TechForward's trade secrets and breach of contract, and returned a verdict of $22 million in favor of TechForward. And the jury also found by clear and convincing evidence that Best Buy did so willfully and maliciously, so the judge awarded an additional $5 million in punitive damages. . . ."


more news below

Follow @vcexp