|Tronical-made auto tuners are the source of new legal issues for Gibson.
Gibson’s Auto Tuner Controversy
Spills Into The Courtroom
Gibson alleges fraud, Tronical demands $50 million in damages
IN 2015, GIBSON MADE THE DECISION to outfit all its standard models with an auto tuner that had been developed by Tronical. Gibson CEO Henry Juszkiewicz described the tuners as a technical breakthrough as significant as the first electric guitar, but the marketplace showed considerably less enthusiasm. Most guitarists felt the servo-motor mechanism bolted to the back of the headstock detracted from classic Gibson designs, and retailers balked at slumping sales. In 2017, in the face of rising protests and a reported 30% drop in sales, Gibson management backtracked, reverting to standard tuners and offering the Tronical tuners only as an option. While the market was placated, the controversy has spilled into the courtroom with suits and countersuits between Gibson and Hamburg, Germany-based Tronical.
Gibson’s relationship with Tronical dates back to 2008 when it first began installing auto tuners on a limited production Robot Guitar. In 2015, as Gibson prepared to install the tuners on all guitars, the two companies formalized their relationship with a “letter of understanding.” Gibson would provide Tronical with a $1.7 million prepayment to fund R&D efforts and production, and Tronical would supply a specified quantity of tuners. Court records show that between 2015 and 2017, Tronical delivered 49,250 auto tuner sets. Apparently, it was not enough. In December of 2017, Gibson sued Tronical and its founder Chris Adams in Tennessee courts, alleging breach of contract for failing to deliver the requisite number of tuners, and fraud for pocketing some of the cash that had been designated for R&D. Tronical immediately filed to dismiss the suit, arguing that the Tennessee courts lacked jurisdiction. Simultaneously, it filed suit in Hamburg, seeking $198,800 in damages from Gibson for breach of a “Master Professional Services Agreement.”
On April 24, as Gibson was headed toward bankruptcy court, Adams and Tronical raised their claim of damages to $50 million. Then, six days after Gibson entered Chapter 11 on May 7, Tronical submitted two invoices: one for $26,390,402 for unpaid licensing fees for use of the tuners, and one for $24,505,000 for unearned royalties that would have been paid out by 2026. Tronical and Adams provided no details to support their damage claims. Gibson lawyers have filed for dismissal of the claims by August 6 unless supporting documents are submitted.