James R | On 22, Jul 2020

Quibi has faced something of an uphill struggle in the months since it launched in April, with little audience buzz and a slow take-up from subscribers.

Adding to the challenge was a lawsuit from New York video firm Eko, which alleged that the Jeffrey Katzenberg-backed streaming platform had stolen secrets from the firm to design its signature Turnstyle feature. The Turnstyle allows users to flip their mobile devices to view content on Quibi in two modes – portrait of landscape, with seamless transition between the two views, and with additional information or footage available when titles are viewed in landscape.

Eko alleged that it was based on its own technology, which it pitched to Katzenberg in 2017. Eko also claimed in its lawsuit that it shared details of the tech with some employees at Snap. With some Snap employees leaving the social network to join Quibi, Eko alleged that they appropriated the tech, which was protected by a non-disclosure agreement, bringing it to Quibi with them.

Quibi, on the other hand, has said that it developed the feature on its own, denying that its employees that came from Snap had any exposure or access to Eko’s trade secrets.

Eko asked for an injunction so that Quibi would have to stop its Turnstyle feature, claiming that it was damaging Eko’s business prospects. Quibi, meanwhile, retorted that it would suffer “immense harm” if it had to disable its flagship feature.

This month, though, Judge Christina Snyder denied the injunction, saying that Eko had failed to show the feature’s continued use would cause damage to Eko. The ruling, crucially, doesn’t take into account the merits of the lawsuit itself – this was just a ruling on the preliminary injunction.

“Evidence does not indicate any significant investigation by Eko into Quibi’s product, which would be expected if Eko believed that Quibi had relied on Eko’s proprietary technology,” Snyder noted.

“This is a frivolous lawsuit brought by a company and CEO looking for a payday. We will continue to aggressively defend ourselves,” said a Quibi spokesperson.

Eko’s lead attorney, Neel Chatterjee, also commented: “We look forward to presenting the merits of the case at trial, including our request for substantial damages.”

Nonetheless, the first step in the legal battle will come as some relief to Quibi, as it continues to try and establish itself as a notable new player in a crowded, competitive streaming landscape. For more on Quibi, including what’s coming soon each month, click here.

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