Fusion Garage has stepped out to refute claims that the Singapore company had conspired with its public relations firm over several months to dissolve its partnership with U.S. blog site TechCrunch to produce a tablet PC.
Michael Arrington, founder of TechCrunch, posted a blog entry on Thursday providing an update on its litigation against Fusion Garage. He highlighted correspondence between Fusion Garage CEO Chandrasekar Rathakrishnan and its public relations agency, McGrath Power, suggesting that both parties have been "conspiring" for months to break up the TechCrunch partnership.
In his latest blog entry, Arrington also alleged that Fusion Garage and McGrath had fabricated an investor's e-mail, noting that "there was a lot of back and forth about the tone and language to make this fraudulent document seem real".
In response, Fusion Garage released a statement early Friday refuting claims that the e-mail between Rathakrishnan and the investor was fraudulent and describing Arrington's post as an example of "out of context distortion of the facts of the case and the latest act of public bullying using TechCrunch as his pulpit".
"After Fusion Garage and its investors decided to launch JooJoo under the Fusion Garage brand, the company decided to inform Arrington of the decision via an e-mail. Knowing full well that the contents of the document would ultimately be made public by Arrington, Rathakrishnan asked McGrath Power and its CEO Jonathan Bloom for recommendations to make the e-mail's contents clear."
Fusion Garage also accused Arrington's post for "dangerously [blurring] the line between actual journalism and distorted personal opinion".
Amid the competition
In a blog post on the fallout last year, Arrington revealed that Rathakrishnan said he was pressured by investors to move forward and sell the tablet without TechCrunch's involvement just days before the scheduled debut of the tablet. In response, Rathakrishnan said TechCrunch bailed on its promise to provide funding and Fusion Garage had to raise money on its own, build the product independently and lined up manufacturing for the product.
Despite the lawsuit, Fusion Garage proceeded to launch the tablet under a new name, JooJoo. Rathakrishnan told ZDNet Asia in a interview in February that the company had filed a countersuit to dismiss TechCrunch's claims, and in late-August TechCrunch was denied injunction on the production and sale of JooJoo.
The tablet was envisioned to be a Web-surfing device selling at US$200 but was eventually priced at US$499--similar to rival, the Apple iPad.
Despite JooJoo's market headstart over the iPad, the former failed to achieve the popularity of Cupertino's tablet where according to Apple, 3 million of iPads were sold in the first 80 days following its launch.
JooJoo will also have to compete with new tablets that have since entered or are entering the market from well-known hardware manufacturers such as Samsung, with its Galaxy tablet, and Dell Computer's Streak.