Vizio goes after LeEco in lawsuit following busted merger – CNET

LeEco LeSee Concept

Jia Yueting, LeEco’s embattled founder and CEO.

LeEco

Troubled Chinese tech firm LeEco is in even more hot water.

After its bid to purchase TV maker Vizio for $2 billion collapsed in April, Vizio filed a federal lawsuit against LeEco on Tuesday, Variety reported

In April, the companies cited “regulatory headwinds” for scrapping the deal, but Vizio said in the suit that LeEco had already “begun to collapse due to their severe cash flow and financial problems.”

Vizio is seeking tens of millions of dollars in damages, plus an unpaid portion of its merger termination fee.

“We don’t have anything to share at the moment,” a LeEco spokesman said Wednesday when asked about the lawsuit.

China-based LeEco tried make a big splash with its debut in the US. It announced its deal to buy Vizio last July, and in October, the company debuted a smart TV, phone, and self-driving car, as well as services to run on and connect its devices.

But by November, reports surfaced the company was tightening its belt. At the end of November, Chinese regulators announced there would be heightened scrutiny of Chinese capital leaving the country for foreign investments. By May, LeEco opted to cut 70 percent of its US workforce.

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