Smarsh Faces $10 Million Fraud Lawsuit by MobileGuard Founder

MobileGuard’s founder sued Smarsh Inc. for $10 million in Delaware Chancery Court, claiming the rival software maker duped him into selling his company, then intentionally missed post-deal “earnout” milestones by building a product that cannibalized MobileGuard revenues.

Smarsh breached the purchase agreements and misappropriated intellectual property “to develop its own competing platform,” then diverted “millions of dollars in potential revenue from MobileGuard’s platform” to its own, the complaint says, calling the case a parallel of “David v. Goliath.”

The lawsuit was filed Tuesday in Delaware Chancery Court by Todd M. Cohan, who claims Smarsh’s scheme deprived him of at least ...