blinkbox Entertainment: Former Blinkbox employees sue Guvera for £10m

Around 100 former employees of defunct music streaming service Blinkbox, formerly owned by Tesco, have issued a class action lawsuit in the UK Employment Tribunal for an estimated £10 million against Guvera Ltd and two of its UK-based subsidiaries.The lawsuit seeks damages following the dismissal of the entire workforce shortly after this acquisition.Under the ownership of Tesco, the Blinkbox brand comprised both video-on-demand and online music streaming. The video-on-demand business was sold to Talk Talk.The music arm of Blinkbox, which is the sole focus of this litigation, was bought by the Guvera group, which operates a global music streaming service.After the acquisition, the Blinkbox music service was taken from solvency (with a reported £3.5 million in the bank) to insolvency within five months, and subsequently defaulted on substantial debts, including debts owed to a number of key creditors such as large music industry companies.Following the acquisition, the employees reportedly received a written assurance from Tesco and Guvera UK that they would receive redundancy payments if cut backs were required, but the former employees claim that this agreement was not honoured.Paul Jennings, partner at city law firm Bates Wells Braithwaite, who represents 80 of the ex-employees said: "Nearly 100 staff were dismissed without any warning and without any notice or redundancy payments. Many of the employees are still owed wages. For a large number of these people, including those with families and mortgages, this had a devastating impact.""We anticipate that there will be other claims arising from this situation. Aside from the appalling way in which these employees were treated, at the heart of this case is the data of two to three million users of the Blinkbox music service. We have no doubt that, as the case develops and the evidence emerges, customers and investors will want to understand precisely what occurred."