Singapore startup faces lawsuit crunch

December 1, 2009
Singapore Democrats

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Victoria Ho
ZDNet Asia

A Singapore startup that was on the verge of debuting a much-anticipated tablet PC in the United States, may now be staring at multiple lawsuits instead after it fell out with its U.S. partner.

For the past year and a half, Singapore-based Fusion Garage was working with U.S. tech blog TechCrunch, to produce a Web-surfing tablet called the CrunchPad.

However, TechCrunch’s founder Michael Arrington on Monday posted an impassioned diatribe declaring the CrunchPad project dead–a result of foulplay on Fusion Garage’s end, he alleged.

According to Arrington, Fusion Garage attempted to edge TechCrunch out of the deal and sell the device under its own name.

“The entire project self-destructed over nothing more than greed, jealousy and miscommunication,” he said.

On the CrunchPad device, Arrington said: “It was so close I could taste it… The look of pure joy on the handful of outsiders who had used it made the nearly 1.5 year effort completely worth it.”

He described Fusion Garage’s move as “theft of intellectual property”. TechCrunch jointly owns the intellectual property rights on CrunchPad, which it co-developed with Fusion Garage, and commands sole ownership over the CrunchPad trademark, Arrington said.

Fusion Garage can expect to face “multiple lawsuits”, which may include its founders and shareholders “as individuals”, he added.

Bryan Tan, director at Singapore-based Keystone Law, told ZDNet Asia in a phone call that both parties involved would be protected in a “fair” agreement, with neither side able to make a commercial decision without the other’s agreement. “You don’t expect one party to have the right to exploit [the product] for his own purposes,” he said.

However, a lawsuit against Fusion Garage may be premature at this point, since both parties can still attempt to reach an agreement before resorting to the judiciary system, said Tan. “There is no need to bring your co-development partner down unnecessarily,” he added.

The Singapore company was founded in February 2008 by Chandrasekar Rathakrishnan, previously known for co-founding mobile software startup, Radixs.

According to reports, the CrunchPad would take the form of a 12-inch capacitive touchscreen running on a 1.6GHz Intel Atom processor. The device would be powered by a WebKit-based browser OS created by Fusion Garage, with no embedded storage and meant to support online surfing only.

While the device was originally targeted to retail at US$200, this figure eventually grew to US$400.

It is unclear whether Fusion Garage has received seed funding from the Singapore government, though one government-linked agency ZDNet Asia contacted, said it did not provide any seed funding to the local startup.

Neither Chandrasekar nor a Fusion Garage representative could be reached by press time.

http://www.zdnetasia.com/news/business/0,39044229,62059719,00.htm