The origin of Dr. Dre and Jimmy Iovine’s Beats headphones is under debate in Los Angeles Superior Court, as entrepreneur Steven Lamar is suing the duo for allegedly screwing him out of $100 million in royalties.
Lamar claims it was him who brought the idea of a celebrity-endorsed headphone line to Dre and Iovine, back in 2006, according to Billboard. After a falling out, the duo sued him, with both parties eventually settling. The conditions were simple: Lamar relinquished his rights in exchange for four percent royalties of every headphone sold thereafter. Of course, Beats started designing and selling newer models, with Dre and Iovine eventually selling the company to Apple for $3 billion. The issue now is whether or not Lamar is owed royalties for the models sold after the initial settlement was made, or if Dre and Iovine—who no longer own Beats—owe him a substantial amount more.
While the judge originally rejected Lamar’s claim that they do, a California appeals court thought otherwise and revived the lawsuit in 2016, stating that the royalty agreement both parties initially agreed to was “ambiguous.” That brings us to the current proceedings, which revolve around the debate as to whether or not the agreement was about one particular product, or any future iterations and models.
From Dre and Iovine’s point of view, it was completely unpredictable that Apple would purchase their company for such a staggering amount, and that there would even be follow-up models to potentially warrant such a legal debate.
After all, Apple could’ve simply purchased the rights and shelved the product, or completely reimagined it, rebranded it, etc.—it happens all the time. Lamar, meanwhile, introduced a PowerPoint presentation containing slides from the humble beginnings of Beats, wherein he brainstormed various models that he, Dre, and Iovine would collaborate on in the future. As it stands, this entire matter is currently for the Los Angeles Superior Court to wade through—with the end result sure to make the news.