Lawsuits - and mud-slinging - begin in CrunchPad/JooJoo dispute

As expected, TechCrunch has filed a lawsuit against Fusion Garage over a tablet PC-like device that was once known as Crunchpad but is being pre-sold as JooJoo. The suit, filed by TechCrunch Thursday in federal court in Northern California, includes a number of allegations against Fusion Garage: Fraud and Deceit, Misappropriation of Business Ideas, Breach of Fiduciary Duty, Unfair Competition and Violations of the Lanham Act.

You can read the full text of the complaint here - but the juicy mud-slinging stuff that I certainly expected from TechCrunch founder Michael Arrington can be found in the blog post he published this morning. In that post, Arrington calls his former business associate Chandrasekar Rathakrishnan (it's hard to say if they were ever "partners") a bad guy who has "a long pattern of deceit" in business practices and also plagiarizes articles.

Yes, folks, this lawsuit is going to be pretty ugly. And when ugly dark clouds start hovering over an expensive product that releases under pre-sale conditions - with a price tag of $500 - I know enough to stay far far away from it. And I don't care how cool it is.

Also see: The Three T's that will hurt JooJoo's chance at success

Arrington, despite the mud-slinging in his post, does make one very valid observation. In his post, he writes (with the bold emphasis added by Arrington, not me):

Fusion Garage’s financial situation is a mess, and it is inappropriate for press to recommend to people to pre-buy a CrunchPad. The company has not yet hired an attorney to respond to our lawsuit. We believe they do not have the cash flow to do so. When the device goes on pre sales today, linked to from scores of gadget and press sites, they will suddenly have cash flow to defend themselves. What they won’t have is cash flow to build the devices. We believe it is irresponsible for press to link to the pre-sale site without disclosing this to readers.

I don't know anything about the financial situation of Fusion Garage or Rathakrishnan - but I will say that I had some pretty big issues, right out of the gate, with that whole buy-now-and-get-later approach. Aside from the early adopter techies who have the cash to support their I-got-it-first habits, I can't imagine that consumers in this economy would drop $500 during the holiday season for something that won't be shipped for another 2-3 months. We're talking mid-February or early March here.

Yeah, that's a big "No, thanks" from me - and Larry Dignan, too, who has had his own nightmare experience with a pre-sale order.

As much as I like the idea behind a CrunchPad or JooJoo type device - or any other similar device that hits the market - I'm not getting anywhere near this one. And I'd offer the same advice to anyone who asks.

Also see: Fusion Garage announces JooJoo cloud tablet; swipes at TechCrunch