FitBit might be the dominant wearable company, but Jawbone on Wednesday revealed several concerning issues involving ways FitBit picked apart Jawbone from the inside.
In a California court filing, Jawbone revealed FitBit contacted a third of Jawbone’s staff, offering jobs with better pay and other incentives. Several staff members took FitBit up on the offer and a few stole information from Jawbone before leaving.
Two employees downloaded internal presentations two weeks before leaving to join FitBit, raising concerns that FitBit had asked the employees to forward Jawbone’s plans.
Jawbone claims FitBit has been trying to destroy the company from the inside, by turning employees to FitBit and stealing intellectual property. By having information on current and future projects, FitBit has been able to copy and advance its own technologies, to surpass the current crop of Jawbone products.
Jawbone has a right to fight against FitBit, considering it only commands 10 per cent of the wearable market, while FitBit holds 80 per cent. That upward trend from FitBit has been helped along with continued successful launches, while Jawbone’s attempts at innovating the wearable have been met with less success.
FitBit is planning an initial public offering later this year, but this new class action lawsuit could be a spanner in the works. It is terrible PR, especially if the allegations against FitBit are true and it has been stealing ideas and employees from Jawbone.
Jawbone could throw a lot of allegations forward if this lawsuit is found to be accurate, including the fact it has lost millions of sales due to FitBit’s poor business practices. It recently had to take out a loan to keep above board, and rumours of buyout attempts and lacklustre funding rounds continue to plague the company.
FitBit has denied the allegations, but the trial in California will continue through FitBit’s IPO, unless it delays for a few months to settle the issue.