Things keep getting worse motorcycle helmet startup Skully, as its production partner Flextronics has filed suit for money and materials allegedly owed it.
According to court documents, Flextronics is demanding payment of roughly $2 million dollars – $505,703 in past-due bills, $514,409 in unpaid bills, and another $1.5 million in what Flextronics calls “materials and inventory related to the Skully project.”
This lawsuit is the second legal action taken against Skully since the company laid off its workforce and shut its doors for lack of funding.
Skully on Friday finally acknowledged what has already been known in the motorcycling community: the company was going out of business. The news comes after a last-minute effort by the remaining management to secure a new round of funding.
With $15 million down the drain, work still to do before the Skully AR-1 would be ready to ship, and a growing group of disgruntled early adopters, Skully’s resurrection was not to be.
Instead in a letter to backers and customers, Skully announced that it would be filing for Chapter 7 bankruptcy, the bankruptcy procedure for companies that are going out of business. This news, of course, directly impacts the thousands of motorcyclists who were expecting to receive a Skully AR-1 helmet.
It was just two weeks ago that we told you about Skully’s investors ousting brothers Marcus Weller and Mitch Weller from the San Francisco startup, and today TechCrunch reports that the motorcycle helmet company will be rather swiftly closing its doors.
A&R readers may remember that Skully’s latest delay to market stemmed from the Skully AR-1 helmet not being ready for mass production, despite the nearly $15 million raised through seed money and a Series A funding round, which was led by Intel Capital.
As such, the closure surely stems from Skully’s investors choosing to shut down the company’s operations, rather than rebuild Skully’s tarnished reputation and retool its product for mass production.
According to TechCrunch, operations at Skully have already ceased, and the website is expected to go offline later today, though as of this writing Skully’s website remains, and its social marketing team is still on Facebook cooling the heels of angry customers.
TechCrunch is reporting, and our sources have confirmed, that the investors behind the Skully AR-1 helmet have ousted one of the company’s founders, Marcus Weller, along with his brother Mitch Weller. For those who don’t know, Marcus Weller was Skully’s CEO, while Mitch Weller served as the company’s Chief of Staff.
The departure of the Weller brothers comes after Skully continually missed its delivery deadlines with its first product, the Skully AR-1, which is a helmet with an integrated rear-facing camera, small computer system, and heads-up-display oculus.
The Skully AR-1 helmet debuted to much fanfare, but it soon became clear that the company’s leadership wasn’t up to the task on delivering the promises they were making to the public. Seemingly on a different page with their investors as well, Marcus and Mitch Weller were fired by the company’s Board of Directors.
It looks like Martin Fitcher, Skully’s current COO, will take over the reigns for the company, or what’s left of it, as its new CEO. Hopefully this means that Skully will finally get on the right path and begin delivery helmets to its plethora of early backers. We are not holding our breath, however.