Modern-day startups produce some slick marketing videos, but they can often need to be taken with a pinch of salt.
A US judge has said that Bengaluru-headquartered Ultrahuman, which makes smart rings and health monitoring devices, faked having a entire factory in Plano, Texas. Ultrahuman had been taken to US court by smart ring maker Oura for allegedly infringing on its patents. In a preliminary ruling, the judge said that not only were Oura’s patents infringed, but added that Ultrahuman might have misrepresented having a factory in the US which it said would soon begin producing smart rings for the US market.
“A concerning issue regarding Ultrahuman’s credibility, however, needs to be addressed up front,” the preliminary ruling, which was accessed by OfficeChai, said. “At the evidentiary hearing, Oura raised an issue about what it said was “an alteration that was made to Ultrahuman’s evidence” …relating to a facility in Texas,” it added.
“Oura objected to slides that were to be presented with (Ultrahuman CEO) Mr. Kumar’s testimony relating to the Texas facility. After multiple rounds of objections, Ultrahuman did not use the slides and after hiring a private investigator during trial, Oura confirmed that information about the Texas facility that Ultrahuman would have presented, but for its objections, was false,” the ruling said.
The ruling also came with some pretty damning images attached. The first was a screengrab from Ultrahuman’s marketing video showing its Plano manufacturing facility with the company’s name and logo emblazoned in giant lettering on the front. But another image, titled “Reality”, showed the same building with no Ultrahuman logo at all.
Yet another screengrab from Ultrahuman’s video showed Ultrahuman’s logos hung from the factory ceilings. But the reality, as per the court, was that the signage was completely different. “In Mr Kumar’s proposed slides, interior signage with Ultrahuman’s logo was fabricated to cover the actual signage,” the ruling said.
The ruling added that the marks on the components of the smart ring were also faked to represent Ultrahuman. “Markings on parts were fabricated to indicate they were Ultrahuman’s parts,” the ruling said.
“In conjunction with contending that it has a manufacturing facility in Texas, Ultrahuman intended to show, through Mr. Kumar’s slides, a building in Plano, Texas. The reality is that the building does not house an Ultrahuman facility; it is the facility of a third party, SVtronics, which Ultrauhman characterizes as its manufacturing partner,” the court said.
Incredibly, Ultrahuman’s lawyer tried to deflect blame by saying that the video had been altered by Ultrahuman’s Marketing Department, and claimed that the company hadn’t officially submitted it as evidence. “What is changed in that video was changed by the Marketing Department at Ultrahuman as part of pre-production to make a commercial. Nothing to do with changing evidence as has been implied there,” Ultrahuman’s legal counsel said.
The judge took a dim view of this argument. “Ultrahuman’s counsel also stated that the video that was to accompany Mr. Kumar’s testimony “was only coining in as a demonstrative. This is concerning. It certainly cannot be that the presentation of false information can be excused because it is presented as a “demonstrative.”” the ruling said.
The video had also been shared by Ultrahuman’s founders and its official company accounts on social media earlier this year, and had garnered plenty of attention. It showed the giant Ultrahuman factory with large American flags plastered on the walls, and local workers hard at work ostensibly building Ultrahuman’s smart rings. The video felt like a glimpse into rare Indian hardware success story — an Indian startup out of Bengaluru had managed to get an assembly line up and running in the US. It now turns out that the video was faked, and the factory never belonged to Ultrahuman at all, but to a third-party manufacturing partner. Such tactics could not only erode consumers’ trust in startups, but also the general image of Indian startups abroad — just last year, Byju’s had landed in trouble with US legal authorities for misrepresenting the usage of funds by its American arm. And a prominent Indian startup having faked an entire factory in the US — and then tried passing it off as real to the local courts ad judges — isn’t the best look for the country’s fledging startup ecosystem.