Apple’s purchase of Color Labs confirmed in lawsuit

Last month, it was reported that Apple was looking to purchase Color Labs, a struggling Palo Alto-based social startup that allows users to share photos and videos. The story was initially filed away as a rumor, as Apple never commented on it. But the acquisition was confirmed today in a lawsuit filing…

Former Color employee Adam Witherspoon is suing the media sharing company, claiming he has been the victim of retaliation, and “intentional infliction of emotional distress.” Witherspoon was laid off during the firm’s recent wind-down and is seeking damages for lost wages, benefits and other consolation.

The lawsuit in and of itself is pretty bizarre. Most of it seems to revolve around Color’s CEO Bill Nguyen, who was listed as a co-defendent in the filing, and his alleged misuse of company funds and his overall behavior towards Color employees. But of course, what we’re most interested in, is the connection to Apple.

Here’s the money excerpt from the documents (via TechCrunch):

“Finally, When the company failed and key assets were being sold to Apple, Nguyen specifically retaliated against Witherspoon by blocking his job opportunities at Apple, offering him a de minimis severance package, disparaging him in the workplace and communicating to others that Witherspoon was being punished for cooperating with an investigation into Nguyen supervised by Color’s outside counsel Gunederson Dettmer.”

Honestly, it’s not all that surprising to see the Color situation drum up litigation. It’s rumored that the company still has a sizeable chunk of its infamous $40 million funding round, and there was a lot of tension between Nguyen, Color’s board of directors and employees leading up to the Apple takeover.

It still remains to be seen what Tim Cook and company plan to do with Color’s “key assets.” It’s believed that Apple also recently acquired the HTML5 design team over at Particle, so it’s possible that it has something big in the works. Maybe this all has something to do with its rumored internet radio project.