When Michael Robertson sold Linspire to Xandros, I doubt many people saw a lawsuit coming his way from former Linspire CEO Kevin Carmony.
Carmony had not seen eye-to-eye with Robertson about Linspire’s future since the summer of 2007 when he resigned as CEO. Other Linspire executives followed and many people thought that Linspire, and its self-named distributions and its community distribution, Freespire would soon follow. Carmony’s feelings about his old distributions may be judged from the fact that, in October 2007, he switched to Ubuntu..
But, the split between the two Linspire executives wasn’t over yet. When, in April 2008, Robertson sold Linspire’s assets, including the key CNR (Click’N'Run) Web-based installation system, to Xandros, Carmony was ticked off.
Carmony felt that Linspire had been sold for an unfairly low price. Carmony wrote, at the time, “Before Linspire and Xandros try to spin this into something actually positive, I’d like to offer my Linspire shares to either Michael or Andy Typaldos (Xandros’ CEO) for $.10 a share. That’s 80% less than what it was worth just ten months ago. If this transaction happened at a good valuation, then I’m sure Michael and/or Andy will be all over my offer, right? I’ll post here when they accept my offer. Don’t hold your breath.”
Later, Carmony would describe the Linspire to Xandros sale a “a midnight, back-room sell-off without a shareholders meeting.” Then, when that had no results, Carmony took the next step. On September 26th, Carmony announced that Robertson was being sued over the deal.
Carmony wrote that, “Because Michael Robertson was the Chairman of Linspire’s board and apparently their only board member (shareholders have never been given notice of anyone else having been added to the board since Robertson fired all the other board members over a year ago), it would be improper for him to make deals that would only benefit him as the majority shareholder. The lawsuit alleges Robertson did not fulfill his fiduciary responsibility to not only act in his best interest but in the interest of all, shareholders.”
He went on, “Regardless of the ultimate outcome of this suit, if nothing else, it will hopefully, once and for all, bring to light what happened to Linspire. The minority shareholders have a right to know, and it’s unfortunate it has taken this lawsuit to get any information form Robertson.”
Now, on October 15th, Carmony continues his war against his Robertson. Carmony reports in his blog that “Robertson and [Larry] Kettler [Linspire's CEO before its sale to Xandros] finally responded to the suit, and I got a copy of their response. From what I could see, what they produced did not provide any meaningful data on the missing cash.” So it is that Carmony still wants to know “What happened with the millions of dollars in missing cash and other Linspire assets?”
While the lawsuit seems unlikely to dissolve the acquisition of Linspire by Xandros, the battle over exactly how and why Linspire disappeared and what happened to its assets seems destined to be settled in a California court-room.