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Thursday, July 20, 2006

The Meltdown at Rocketboom: How Law Shaped the Outcome

If you've heard of Rocketboom, the three-minute daily video blog, you've probably heard about the falling-out between the two people behind it: host Amanda Congdon and producer Andrew Michael Baron.  My description of their titles, actually, is not quite correct, and that is what led to the falling out.  Although Baron came up with the idea and has produced most of the episodes, Congdon has done some writing and producing for the show as well.  According to Congdon, the rift developed when Baron insisted that Congdon only be the "face" of Rocketboom, while she wanted a larger role. 

What happened next is still unclear, and the law of business organizations may be playing a role.  Congdon reports that she owns 49% of Rocketboom, and that she continues to hold that ownership stake.  (See also this interview and this comment to her post.)  But she also says that she has been "fired."  Baron reported on Rocketboom, however, that Congdon had decided to leave Rocketboom and move to L.A. to pursue an acting career.  (Congdon has appeared on CSI and other television shows.)  In a lengthy letter which she posted for her readers, Congdon contested Baron's claims and even laid out a timeline of their conversations.  But Blogcritics and Valley Wag are now reporting that Baron believes Congdon forfeited her ownership stake by leaving the show.

So did Congdon quit or was she fired?  And what do those terms mean when applied to a 49% owner?  (Or former owner?)  As this case plays out, it may be a fascinating case study on closely-held corporations.  One interesting wrinkle to the tale: even though she claims to have been fired, she is still actively promoting Rocketboom.  Why?  She's an owner, of course.  Watch the awkward moment at the end of this Scarborough clip for an example.

Posted by Matt Bodie on July 20, 2006 at 11:09 AM in Corporate | Permalink


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