7:11am PT by Ashley Cullins
Eko Loses Emergency Bid to Keep Quibi From Selling Turnstyle Tech
A California federal judge has rejected Eko's emergency request to freeze some of Quibi's assets in a dispute over the technology the since-shuttered platform uses to transition video from landscape to portrait mode.
That technology, dubbed Turnstyle by Quibi, has been the center of the legal battle since March. Quibi launched in April and on Oct. 21 announced it would be shutting down operations, which prompted Eko to file a motion asking the court for emergency relief. Effectively, the company wanted U.S. District Judge Christina Snyder to order Quibi not to sell the intellectual property that's at issue here and ensure it keeps enough cash on hand to pay damages in the event that Eko prevails in the dispute.
Snyder on Thursday denied Eko's request, finding it hasn't shown it's likely to suffer irreparable harm.
"Eko does not provide additional evidence — such as an assertion that Quibi has agreed to a transaction encumbering its IP assets, has announced its intention to distribute funds to investors by a particular date or has taken legal action to dissolve Quibi Holdings LLC — that might justify immediate or ex parte relief," she writes. (Read the full decision below.)
Snyder also notes that Quibi has indicated it has no plans to disrupt the status quo and a declaration from CEO Meg Whitman said while it's exploring a sale of the company it "has no plans to separately sell its patents or Turnstyle feature" and has set aside funds "that are reasonably likely to provide compensation for the claims in this litigation."
Quibi has to submit within two days a written status report regarding whether it has taken legal steps to dissolve, and Snyder also directed the company that it must notify the court and Eko within 48 hours of deciding to sell Quibi or any of its IP assets or to distribute funds to its investors.
The next hearing is currently set for Dec. 21.