Ex-Executive Sues Startup CEO for Buying Lamborghini with Company Funds, Fueling Racing Hobby

Facepalm: When a startup rises from the ashes of a failed tech venture, you’d hope the new founders have learned their lesson. But a new lawsuit against Osom Products, a company formed by former Essential employees after it went bust, alleges that its CEO skimmed money from the company.

Former Osom Chief Privacy Officer Mary Stone Ross is taking legal action against the company and current CEO Jason Keats. The lawsuit alleges that Keats used company funds to buy himself two Lamborghinis. Other allegations in the lawsuit include using corporate funds to pay off his mortgage, booking countless first-class tickets, funding an expensive racing hobby and paying his racing partner’s salary.

Ross also claims that the previous finance chief may have resigned over the scandal, after which Keats replaced him with someone more sympathetic to his personal “financial needs.” She asked the court to compel the Osoms to release internal documents.

But it doesn’t end there. The lawsuit claims that Hewlett-Packard considered acquiring the company for a certain amount, but withdrew from the deal when the price couldn’t be met. The lawsuit claims that Keats has drained Osom’s resources and needs more capital to keep the company afloat.

A spokesperson for Osom told Android Authority that the allegations in the lawsuit are “extraordinary” and denied that the company or Keats committed any wrongdoing.

Osom launched with a lot of hype and optimism just a few years ago, founded by former Essential employees who wanted to build on the company’s principles after it went under.

Osom announced its first product, the OV1, in early 2022 as a privacy-focused phone priced around $1,000. A few months later, the OV1 was rebranded as the “Saga” through a partnership with crypto platform Solana. The company described the Saga as a “Web3 smartphone” with software developed using the Solana Mobile Stack (SMS), an open-source toolkit for enabling native Android Web3 apps on the Solana platform. In the partnership, Osom handled the hardware, while Solana handled the software.

Osom also produced a privacy-focused data cable, featuring a Type-C plug with a switch that would disconnect all the data cables. There was talk of a Saga Two phone, but that device never materialized.