Snapchat CEO Evan Spiegel, in a lawsuit filed by a former employee, has been accused of commenting that he has no intentions of expanding services into poor countries like India and Spain.
As per reports, the lawsuit filed in LA district court on Monday by a former employee named Anthony Pompliano makes a range of claims about the company, including that Snap Inc shared inflated metrics during the time of its IPO.
According to the lawsuit, Pompliano worked at the firm for three weeks before he was fired for uncovering ‘massive internal systematic failure’ and reporting it to seniors. Snapchat’s legal team called Pompliano a “disgruntled employee fired for poor performance”.
Pampliano alleges that the company recorded false user-data and presented inflated metrics to investors while declaring IPO back in March.
According to him, Snap gained its user data metrics through two analytics system, Flurry and Blizzard which showed its number of Daily Active Users (DAU) as 95 million and 97 million respectively. Snapchat, however, claimed it to be 100 million. In a meeting in September 2015, Spiegel shrugged this as “no big deal” as per Pampliano.
Pompliano also blamed Imran Khan, Snap’s chief strategy officer for asking him to break a non-competent clause by giving a detailed organisational structure of Facebook. The move was aimed to poach more talent from the rival company.
Snap declared a retention rate of 40 percent, which the former employee claims to be “closer to 20 percent”. Similarly, the number of users which completed the app registration process was less than 40 percent, instead of the 87 percent which Snap claimed.
Upon Pampliano’s idea of expanding into international markets like India and Spain, Evan Spiegel commented, “This app is only for rich people. I don't want to expand into poor countries like India and Spain.”
As per John Pierce, the lawyer representing Pompliano, Snap did not proceed to seal his complaint as the company was aware that "it was flat wrong on the law and would lose its motion in court."
Snap’s attorneys wrote “The simple fact is that he knows exactly nothing about Snap’s current metrics. He and his lawyers are — not to put too fine a point on matters — just making things up.”
The interesting thing to note here is that Anthony Pompliano is an ex-Facebook employee. With the ever-lasting combat between Mark Zuckerberg and Evan Spiegel to reign social media, the topic is surely going to be taken up during the legal battle