Beats Electronics cofounders Dr. Dre and Jimmy Iovine were hit with a $25 million verdict in favor of former business partner Steven Lamar in a Los Angeles Superior Court on Wednesday, according to reports in The Hollywood Reporter and TMZ. In a 2016 lawsuit, Lamar and Jibe audio sought $100 million, alleging breach of contract over royalties for headphones’ original design.
An L.A. jury awarded Lamar $25,247,350 after ruling the Dre and Iovine had not compensated him for design work he did on three headphone models; the pair had previously argued he was only owned royalties on one model, based on a 2007 agreement that specified only one model.
An attorney and reps for Dre, Iovine and Beats did not immediately respond to Variety’s requests for comment.
In 2006, Dre’s lawyers filed a suit against Jibe, Lamar and the design firm Pentagram (of which co-designer Robert Brunner was a partner) and Lamar accusing them of failing to meet contractual agreements. In a 2007 settlement, Iovine and Dre agreed to pay a royalty on the basis of “4 percent base price of every headphone,” but only one headphone, Beats Studio, was specified.
The plaintiff argued that the design carried over to other models and the jury agreed, deciding on Monday that the original headphone’s characteristics had been used on later models with “minor cosmetic changes” and that Dre and Iovine should pay $25,247,350 in royalties on the Studio 2 Remastered, the Studio 2 Wireless and the Studio 3 models.
Beats was founded by Dre and Iovine in 2006 as Beats by Dre and was sold to Apple Inc. in 2014 for $3 billion.
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