• 03
  • February
    2011

A previous post on this blog discussed a prepaid debit card product that was to be endorsed by the Kardashian reality star sisters. After the "Kardashian Kard" launched, it was criticized by financial experts and public officials for having high, hidden usage fees and was called a terrible financial product that preyed on non-financially savvy consumers, such as young people without much credit card or financial experience. The card's hidden fees and interest rates could easily lead an inexperienced person to hurt their credit.

The Kardashians promptly walked away from the product, aware that it was doing damage to their carefully cultivated image and brand. The company that developed the product, Mobile Resource Card, has now filed a lawsuit against the sisters for breach of contract.

According to THR, Esq., the company claims that the sisters were not only sponsors of the product, but partners in a joint business venture. The sisters were paid a signing bonus and advance on royalties, and they also were to receive $3 for each card activated or sold and a 25-percent share of all usage and transaction fees. Now that they walked away, the company wants them to share in responsibility for the failure of the company.

The company says that the sisters illegally broke their contract by leaving in the way that they did. According to THR, Esq., the contract said that the sisters could only leave with 30 days' notice in the event of bankruptcy, lack of insurance or failure to make payments.

Source:

Why the $75 Million Kardashian Lawsuit is Pretty Serious (The Hollywood Reporter)