As the number of mobile application start-ups has boomed, and the potential for huge valuations has been buoyed by deals like Facebook Inc.’s more than $700 million acquisition of photo-sharing app Instagram last year, disputes between foundersor people who allege to have played a key role in a company’s foundinghave taken on a new level of intensity.
As a result, Am Law lawyers who work with tech start-ups are increasingly finding themselves in the middle of resolving founder disputes, which can vary from quickly resolved disagreements about titles to full-fledged splits where resolutions are negotiated over weeks. These types of disagreements rarely mature into lawsuits like those that engulfed Facebook, which was embroiled in litigation for years with a small chorus of plaintiffs who claimed that they had either originated the concept or played a key role in the social networking service’s early development.
