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Apple’s Beats Electronics Division Owes $25 Million to Early Beats Developer

Apple’s Beats Electronics Division Owes $25 Million to Early Beats Developer

A Los Angeles jury on Wednesday ruled that Beats founders Dr. Dre and Jimmy Iovine  owe Steve Lamar $25 million under the terms of a 2007 settlement that said Lamar was entitled to royalties from the sales of headphones based on the original “Studio” headphone model.

Bloomberg:

Lamar claimed that in January 2006, he took his idea for high-quality headphones with an iconic design and promoted by a well-known musician to Iovine, who proposed Andre Young, the producer and rapper known as Dr. Dre., as the celebrity to endorse the headsets. Lamar said he worked on the concept and design of the Beats headphones until a falling out with the Beats founders in 2006 that prompted them to sue him for breach of contract.

“The jury’s verdict reflects Mr. Lamar’s contribution to the origin of the Beats by Dr. Dre headphones product line,” his lawyer, Brian Melton, told Bloomberg in a telephone interview.

Lamar has signed over the rights to the Beats design in exchange for royalties in 2006. He claimed the terms of the settlement indicated he was owed royalties on all Beats models, while Dre and Iovine argued he was entitled to royalties only for sales of the original Studio model, released in 2008.

The jury decided got Lamar, awarding him royalties on all models of the Studio beats headphones, but not other models. Since the claim was for breach of contract, the total judgement could total $40 million or more, due to the including of interest and attorney fees.

Apple purchased the Beats brand in 2014, paying $3 billion. Jimmy Iovine and Dr. Dre came along as part of the deal.

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