Corporate giants can often take advantage of small start-ups, hoping that they can get away with it. However, there are instances when a resilient start-up would make an established corporate entity pay for playing unfair. This seems to be so in the legal battle between TechForward and Best Buy.
The entire fiasco began back in 2009 when TechForward folks decided to partner with Best Buy over a very innovative scheme. It was termed ‘Guaranteed Buyback Plan’ and had been envisioned by TechForward.
The idea was to let a customer buy a plan together with a gadget when he purchases it. The plan allows the customers the option of selling the gadget back to Best Buy one day. Once they decide to sell it back, they are awarded store credit which decreases the longer they keep the gadget.
TechForward deployed an intelligent calculation to determine the value of a gadget that is being bought back and to pay the customer accordingly. The startup alleges that it handed this proprietary data to Best Buy folks, in lieu of the partnership.
However, Best Buy got greedy; it broke off the partnership and launched a similar program of their own using the proprietary data. As a result of this, TechForward nearly went bankrupt and had to borrow money to launch a lawsuit against the retailer giant.
Thankfully, the court has now decided in favor of TechForward, awarding it $22 million for the improper use of its data by Best Buy and another $5 million in punitive damages. The results of the lawsuit will make the likes of Best Buy think twice before defrauding another start-up in the future.
Courtesy: Tech Crunch