Smartphone brand LeEco has been sued by a TV making company called Vizio, that was supposed to be acquired by the former for a sum of $2 billion.
Vizio has filed two separate lawsuits against the Chinese conglomerate in the US states of Los Angeles and California demanding amounts of $60 million and $50 million, respectively, for the damages caused to them.
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The cases were registered against the cancellation of the deal involving the company’s acquisition of Vizio. The lawsuit alleges LeEco’s true aim was to create “a false impression of its financial health, as well as gain access to its corporate customers, decision makers and confidential customer information that had been developed by Vizio.”
“We don’t have anything to share at the moment,” a LeEco spokesman said when asked about the lawsuit.
However, in response to the deal, LeEco in April had cited regulatory headwinds for scrapping the deal, but Vizio said in the suit that LeEco had already begun to collapse due to their severe cash flow and financial problems.
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The lawsuit of tens of millions of dollars plus an unpaid portion of its merger termination fee will help Vizio to recover from the damages caused by the unfulfilled deal.
While for LeEco it means a sizeable addition to its already overflowing kitty of problems. It would be interesting to see what the outcome of this battle eventually turns out to be.
