Beats Causes More Legal Trouble For Apple

Apple Inc. AAPL is back in the news with legal trouble, but this time it's the recently acquired Beats Electronics that is facing fines. The headphone manufacturing company is being sued by former partner Monster LLC, which claims that Beats’ co-owners Jimmy Iovine and Dr. Dre conspired to eliminate Monster’s stake in the company before being bought by Apple.

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The Lawsuit

Monster’s manager Noel Lee said he worked together with Iovine and Dre to develop the headphones, but that the two used a “sham transaction” with HTC in order to sever its ties with Monster ahead of the Apple deal.

Monster claims that millions were lost in revenue and that Lee’s 5 percent stake in the company would be worth $100 million today.

Past Suits

This is not the first time Apple has had to deal with Beats’ legal troubles. The premium headphone maker was also sued by Bose last year over a patent violation just months before Apple’s acquisition was set to take place.

While Apple hasn’t revealed its plans for the Beats acquisition, many speculate a streaming service was a large factor in the decision. With iTunes slowly losing popularity to streaming sites like Spotify AG and Pandora Media Inc. P, it could only be a matter of time before Apple throws its hat into the subscription-based services arena.