The Venice company dismisses claims that it misled investors over Snapchat usage.
Seeking to quash a lawsuit from a former employee, Snap Inc. dismissed allegations that it lied to investors and advertisers about Snapchat usage as “false from top to bottom.”
The accusations stem from a lawsuit filed this month by Anthony Pompliano, who claimed that the Los Angeles company fired him in September 2015 for raising concerns internally about the alleged misrepresentations. Pompliano says Snap has hurt his chances of landing another job by lying to prospective employers about why he was fired. He’s seeking a court order barring Snap from making such statements.
But in a court filing late Wednesday, Snap said Pompliano did get a new job shortly after leaving Snap. He was fired after less than two months in December 2015 by Brighten Labs. Three months later, Pompliano filed a lawsuit against Brighten, alleging wrongful termination and unjust denial of a 25% stake in the anonymous complimenting app, according to the court papers. Brighten Labs, which denied his claims, didn’t offer immediate comment about the ongoing litigation.
“Pompliano was a disgruntled employee fired for poor performance,” Snap’s attorneys wrote. “To rationalize his firing, Pompliano has ginned up preposterous allegations about Snap giving investors false user metrics back in 2015. Those accusations are sure to grab headlines, but they fail to grasp reality.”
Snap asked Los Angeles County Superior Court Judge Richard Rico to put the case on hold until a private arbitration proceeding is completed. Pompliano’s contract with Snap required all employment disputes to run through arbitration, and he opened a case last July seeking lost wages and other damages. Because Pompliano hasn’t raised the issue of Snap allegedly lying in reference interviews to the arbitrator, he’s unable to seek relief on the matter from a court, the company argues.
The company’s attorneys described Pompliano’s move to go public with a case contractually bound to take place secretly as a stunt apparently intended to pressure the company to “throw in the towel and settle.”
Pompliano’s attorney, David Michaels, didn’t have immediate comment.
Snap also requested that about a third of Pompliano’s complaint remain inaccessible to the public. The company says the redaction protects confidential information, including how it measures usage and research and development initiatives.
Among the statements unavailable are two statistics that Snap allegedly provided to Pompliano during the recruiting process — and to investors, advertisers and the public — that he claims are false. Pompliano also has said Snap tried to get him to share information about Facebook, where he worked for a year, and help recruit former colleagues.
Pompliano lasted three weeks on Snapchat’s business operations team. He’s now a venture capitalist.
His dispute became public at a sensitive time for Snap, the company behind the popular chat app Snapchat and the Spectacles wearable camera. Snap is seeking to open public trading of its shares as early as March in a fundraising that could value the firm at more than $25 billion.
Snap’s other legal issues include a lawsuit filed by two women who say they weren’t fairly compensated for appearing in early marketing materials. A jury trial in that Los Angeles County case is scheduled for October.
Snap also has a handful of patent and trademark infringement cases outstanding. This month, Vaporstream Inc. alleged that Snap stole from several electronic messaging patents. In a similar case, Snap has denied patent infringement allegations lodged in a Texas federal court by Uniloc, a firm notorious for making such claims. Snap has countersued in a third intellectual property case brought by Investel, which says Snapchat’s location-based image filters infringe on patents for its iFramed app.