Thursday, June 21, 2018

Dre insists he came up with Beats concept in royalty court battle | UNLIMITED | CMU

Beats by Dre

Dr Dre yesterday told a court in California that he came up with the concept and name of his Beats By Dre headphones range.

He said that he first discussed the idea of hiking up the price on mediocre headphones by sticking a celebrity’s name on the side (though he possibly didn’t outline the concept in quite those terms) to record industry veteran Jimmy Iovine at his Malibu beach property. He later came up with the brand name because “that’s what we call what I do – I make beats”.

The Beats By Dre business is in court because of long running legal action by another man involved in the enterprise in its earliest years, Steven Lamar.

Contradicting what Dre said yesterday, Lamar claims that it was he who originally pitched the idea of celeb-endorsed headphones to then Universal Music exec Iovine in 2006. He also says that he pulled together the original consortium of companies to work on the design and manufacture of the initial Beats products.

Lamar is suing for $100 million in royalties that he reckons he is due for his part in developing the headphone line. Although who actually had the idea for flogging Dre badged headphones and who came up with Beats brand isn’t what really matters in this dispute, which instead centres on a 2007 agreement.

The partnership put together by Lamar to launch the Beats By Dre brand quickly fell apart leading to a legal settlement of which Lamar was a beneficiary. The question is whether the royalty Beats agreed to pay its original business partners relates to only the original incarnation of the headphones, or subsequent new products evolved from the original.

The dispute over that 2007 contract has been ongoing for years. Ultimately an appeals court ruled that the contractual dispute should go before a jury, which is why Dre and Lamar are in court again this week. The latter continues to insist that the Beats headphones range was his idea, telling the court – according to Law 360 – that Dre and Iovine were “just the celebrity endorsement partner for my product”.

Although not denying Lamar’s involvement, Dre played down his one-time business partner’s role in developing the Beats By Dre concept. He also insisted that conversations back then focused on a single Dre-badged headphone product, rather than an entire business empire that might ultimately be sold for billions to a tech giant.

Lamar, meanwhile, continued to insist that his role was bigger than that, stating in a later testimony yesterday that he only agreed to the 2007 settlement because he feared further litigation could scupper the business venture he had conceived. “This was my baby,” he told the court. “I wanted to see it come to life”.

“I transferred over all my rights in this business and my intellectual property in exchange for a royalty”, he added of the contract at the heart of the current dispute. “They got all the press, all the upside”, he mused, “I just want my two percent”.


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