Snapchat Turns Down Facebook Offer, Files Restraining Order Instead
December 14, 2013

Snapchat Turns Down Facebook Offer, Files Restraining Order Instead

Last month Snapchat, the photo sharing service that has become popular with teenagers and 20-somethings, turned down an offer to be acquired by Facebook, and now it appears the company has filed a temporary restraining order against Frank Reginald Brown.

Earlier this week, Reuters reported that the company alleged that Brown, who has claimed he came up with the idea for the company, leaked deposition testimony that “Snapchat had designated as confidential under the Protective Order entered in the case.”

As redOrbit posted earlier this week, and as originally reported by TechCrunch, the restraining order noted:

“The requested relief is necessary to prevent great or irreparable injury to Snapchat. Snapchat has produced substantial amounts of commercially sensitive and private information in this case, including among other things highly confidential financial and investment information related to Snapchat’s business, sensitive information regarding Snapchat’s business plans, and private, personal communications of individual third parties subject to rights of privacy under the California Constitution. Plaintiff and his counsel purport to reserve the right to disclose any and all such information to the public at any time. Indeed, plaintiff has apparently scheduled imminent ‘exclusive’ interviews with additional media outlets to discuss this case. In the absence of the relief sought, it is highly likely that plaintiff and his counsel will commit additional violations of the Protective Order.”

At this point, a few things are very surprising while others are not.

Surprising is that Snapchat’s owners would turn down a reported $3 billion all-cash acquisition offer from Facebook back in November. The company’s 23-year-old co-founder and CEO reportedly rejected the deal due to competing interests but also because there were other potential suitors lining up to buy the company.

The question does need to be asked, could anything really be better than $3 billion?

Adding to the surprise is that China’s Tencent Holdiings Ltd. had offered to lead an investment that would value the company at $4 billion. This is all for a photo sharing service?

What isn’t surprising in this is that Brown (who is one of the original three co-founders according to some reports) is now looking for his payday!

Many times those who are on the ground floor when a company starts up don’t end up staying for the whole ride. The question remains what those individuals are entitled to when – to mix metaphors – the ship comes in?

In the case of Brown, it sounds like he might have had some of the original concepts for Snapchat, but a judge will likely make the final decision. That is if the company ever gets an actual payday.

At some point, we could be facing a repeat of the dotcom bubble from the late 1990’s. While the early 20-somethings at Snapchat might be too young to remember, a number of companies that had seemingly endless potential couldn’t solve the biggest mystery at the time.

That was how to make a profit.

Consider today that while Facebook is hugely profitable, many of its rivals in the social media space are not. Twitter, which recently had its own IPO, has yet to turn a profit. Apparently, providing people with the ability to make 140 character observations doesn’t make money.

Now, the final question is whether photo messages are worth something. Right now it appears it could be worth billions. But let’s see if that’s true in the months to come?

Image Credit: Tusumaru / Shutterstock

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Peter Suciu is a freelance writer and has covered consumer electronics, technology, electronic entertainment and the fitness sports industry for more than 15 years. In that time his work has appeared in more than three dozen publications including Newsweek, PC Magazine and Wired. His work has also appeared on,,, and Peter is a regular writer for

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