The high-profile project of the "father" of Android is in trouble. The director of the startup spent his money on races, a mortgage, two Lamborghinis

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Smartphone manufacturer Osom, created by the natives of the failed startup Essential of the "father" of Android, Andy Rubin, risks repeating its unenviable fate. A former employee accuses the director of the company, Jason Keats, of embezzlement, disruption of a promising deal with HP and emptying the "treasury" of the enterprise.

Former

Chief Privacy Officer (CPO) of Osom Products, Mary Stone Ross, has filed a lawsuit against the company and its current CEO Jason Keats, writes Android Authority. The ex-employee accuses the CEO and founder of a startup engaged in the development of smartphones of embezzling the company's funds.

Mary Ros, who left Osom in May 2024, is asking the court to provide her with access to Osom's financial and accounting documents, extracts of which could help prove Keats' involvement in financial fraud in further proceedings. The appeal, registered on August 30, 2024, will be considered by the Delaware Court of Chancery (USA).

According to Ross, the CEO purchased two expensive Lamborghini cars for personal use with funds belonging to the company. In addition, he allegedly paid installments on his own mortgage loan, repeatedly bought air tickets to the first-class cabin, and also spent money on hobbies related to car racing - all this at the expense of the company, follows from the statement of claim.

The ex-employee of Osom also notes that the previous financial director of the company resigned, probably due to his unwillingness to put up with the CEO's chosen approach to the management of business funds. The new financial director, specially selected by Keats, allegedly turns a blind eye to the misuse of the company's funds.

Finally, according to Ross, HP was considering acquiring Osom. The American tech giant has repeatedly initiated a deal, but for some unknown reason, it was not possible to reach an agreement each time, and the amount of the deal steadily fell over and over again.

According to the statement of claim, Osom's financial resources are almost exhausted at the time of its filing, and Keats considers it necessary to raise additional capital to keep the business afloat.

Osom found Ross's accusations unfounded. "We are aware of the former employee's ridiculous allegations and look forward to refuting them in court," an Osom spokesperson told Android Authority.

A brief history of Essential and Osom Osom

Products was founded in 2020 by alumni of Essential, the startup of the "father" of the Android mobile operating system, Andy Rubin.

Essential is known for its 2017 Essential Phone PH-1 smartphone. The key feature of the device is the ability to expand with additional modules: on the back of the device case, there is a special connector with a magnetic latch, which allows you to easily install additional components of the device. At the start of sales, customers had access to such external modules as a docking station with charging, a 60 GHz wireless adapter with a bandwidth of 6 Gbps, and an external Experience 360° video camera with coverage 360 degrees, fixed above the smartphone.

The device failed in sales - not least because of the not too unattractive price tag. Those wishing to purchase the device had to pay $700, excluding expansion modules. For comparison: the iPhone 8 plus of the much more famous Apple company, which went on sale in the fall of 2017, was offered at a price of $799.

In 2019 Essential introduced the Essential Phone PH-2 concept with an elongated and very narrow screen, which resembled a TV remote control rather than a modern smartphone. The screen of such a non-standard format, according to the developers, was well suited for viewing social networks. The author of the idea was Rubin personally. In the end, the Essential Phone PH-2 did not go into mass production.

After the Essential failure series, a number of employees, including Jason Keats, who had previously spoken negatively about the PH-1 and dubbed the device a "nightmare for developers", launched their own startup Osom Products in Canada. Keats became its founder and CEO.

The company's first product, a smartphone with a focus on security, was called Osom OV1. The device was expected to go on sale in the summer of 2022, but in June 2022 it became known that the company's plans had changed. Osom OV1 was renamed Saga, and its further development continued in tandem with the Solana blockchain project (which has its own crypto token SOL). At the same time, not only the name has changed, but also the concept of the smartphone - its target audience has become enthusiasts from the world of cryptocurrencies.

Spring 2023 Osom has started sending Saga machines purchased by pre-order. The price of the gadget was $650, including a $100 deposit charged to the buyer when placing a pre-order.

In early 2024, the second generation of Solana crypto smartphones, Mobile Chapter 2, was announced. The start of deliveries of the device is scheduled for 2025.

 

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The company that created the "killer" of Android was suddenly closed

Osom, a smartphone company, has closed. Less than a week ago, it turned out that it was ruined - the founder, who came from the Essential company created by the author of the Android OS, spent all the startup's money on expensive cars, real estate and racing. Osom existed for only three years, but failed to become famous in the global smartphone market - it built ultra-secure smartphones to compete with Android gadgets, but in three years it released only a few copies of just one model.

Goodbye, Osom!

Smartphone manufacturer Osom, created by the Essential startup "father" of Android Andy Rubin, will cease to exist. According to the 9to5Google portal, the startup, founded in 2021, will be closed within two weeks. This is directly related to a lawsuit against its CEO and founder, Jason Keats, who was accused of embezzling the company's funds. The lawsuit against him was filed on August 30,

2024 Osom was created with the idea of releasing a super-secure smartphone with advanced privacy features in defiance of current gadgets on iOS and even more so Android. But for three years of the company's work, it did not release a single device for mass sale - only the debut of one mobile phone OV-1 took place, which came out with a great delay and by the time of release was renamed Saga. It was sent only to those who bought it by pre-order.

The essence of the problem

The closure of Osom was the result of a lawsuit against Jason Keats and the company itself from its former Chief Privacy Officer (CPO) Mary Stone Ross. As CNews reported, she accused Keats of embezzling the company's funds - Ross, who left Osom in May 2024, said that Keats pulled off various financial frauds and bought two Lamborghini cars for personal use with the money of his own company. He also used the company's money to pay for the mortgage, purchase first-class plane tickets and spend money on auto racing, Ross's lawsuit alleges.

She asked the court to provide her with access to the financial and accounting statements of Osom - allegedly with the help of these documents she will be able to prove Keats' guilt. In other words, it doesn't have any evidence now, but Keats, who is now the CEO of Osom, chose to shut down his company.

Ross also claims that Osom has had a relatively new CFO. According to her, the previous one could no longer put up with Keats' machinations and preferred to leave the company, and the one who replaced him was personally selected by Keats and now turns a blind eye to all his deeds.

And here Android and HP

Keats was one of the key employees of the company Essential, which was founded by Andy Rubin, the creator of the world-famous Android OS. The Essential released only one smartphone, the Essential Phone 1, and it, released back in 2017, almost instantly turned out to be a failure - consumers were not interested in it due to too high a price. The Phone 2 never saw it, although Essential even developed several of its concepts.

Keats called the Phone 1 a "developer nightmare" during his time at Essential, and after its failure, he left the company and founded Osom in 2021. At the same time, the OV1 smartphone was announced, which was supposed to be released in the summer of 2022, but in the end appeared only in the spring of 2023 under the name Saga. It did not go on sale. In early 2024 Osom has announced a new smartphone and announced plans to release it in 2025.

And in general, there was a possibility that Osom would cease to exist as a separate company. Ross's lawsuit says that HP was looking at buying Osom and even negotiated with it, which, for unknown reasons, repeatedly reached an impasse. At the same time, with each new stage of the discussion of the deal, its amount was rapidly decreasing.

As a result, the parties did not reach an agreement. In her lawsuit, Ross stressed that Osom has almost completely exhausted its financial resources, and now Keats is looking for a third-party source of capital to keep the company alive.

According to 9to5Google, Jason Keats denies the allegations listed in Ross's lawsuit. An Osom spokesman said the company was "aware of the outlandish allegations by a former employee".