Newly Publicized Lawsuit Confirms Color Inc. Sale to Apple

Details of a lawsuit against Color Lab Inc. made headlines yesterday as a report by Techcrunch revealed that Apple has taken control of Color’s assets. The lawsuit was brought by former founding employee, Adam Witherspoon, who is claiming to be the victim of retaliation, and is seeking damages for “humiliation, mental anguish, and emotional distress” from Color and CEO Bill Nguyen, according to reports.

It was the discovery of the company's sale to Apple found in the language of the lawsuit, however, that has people talking. Color, a California-based start-up focused on social photography applications for phones like the Android and iPhone, has been struggling financially in recent years. The lawsuit filed against the company also reveals that with the purchase, Apple gained 20 former Color employees, in addition to acquiring company assets including intellectual property and technology rights previously thought to be excluded from the deal.

Allegations of Harassment in the Workplace

In his lawsuit, Witherspoon claims that of the 20 engineers hired by Apple from Color, he was intentionally not one of them. This would make Witherspoon the only engineer not transitioned to Apple, even though he is one of the oldest Color employees; he claims this is because Nguyen shut him out of negotiations due to a previous personal conflict. Witherspoon is also accusing Nguyen of subjecting him to a hostile work environment and harassment. (Read about how Employment Law handles hostile work environment harassment in the workplace here.)

Of the numerous reports and commentary in the news and blogosphere, many are saying the lawsuit and allegations it presents will not fare well for Apple's reputation in light of their new hires and acquisition of Color. The company and its CEO have been denying the public information about any sale to Apple, while Nguyen mysteriously resigned. In addition, reports say the lawsuit includes additional allegations of abuse and mistreatment of other Color employees in the past. Many are still speculating regarding the extent of Apple's involvement in the whole ordeal.