When Shutterfly acquired Kodak’s online Gallery photo business for $23.8 million last year, part of the agreement was that Kodak agreed not to set up a duplicate business. However there is a Kodak mobile application that lets users buy photo albums from pictures that are stored on Facebook called “My Kodak Moments.” As a result, Shutterfly filed a complaint with the U.S. Bankruptcy Court in Manhattan claiming that Kodak is violating the sales agreement by setting up a competing business.
Shutterfly said that the app is powered by the same technology that powered the business that Shutterfly acquired.
Last year Kodak filed for bankruptcy, which is why Shutterfly acquired their online business. Kodak said yesterday that they closed on an $848 million finance packaging that helps them emerge from bankruptcy in the middle of this year.
This case was filed under re: Eastman Kodak Co et al, U.S. Bankruptcy Court, Southern District of New York, No. 12-10202.