The future of Masimo Consumer the former Sound United business is still up in the air with the business all wrapped up for sale after the US health Company wrote down all goodwill to zero in their latest financials.

It appears that the company that owns the Dennon, Marantz, and Bowers & Wilkins brands took a significant A$485 million dollar charge against earnings to write-down all of the remaining goodwill carried on the books for the former Sound United business with the write down including all intangible assets.

ChannelNews understands that the Company has been in discussions with several potential buyers including both Chinese and European Companies as well as Canadian and US audio Companies with one party currently doing due dilligence.

Joe Kiani the former CEO and founder of Masimo (seen below) who acquired the Sound United business in 2022 for A$1.4 billion, last week slapped a legal action on the new directors of Masimo claiming they are violating US Labor laws.

Kiani submitted a Private Attorneys General Act (PAGA) notice to the California Labor & Workforce Development Agency regarding Labor Code violations by Masimo and its six Politan-affiliated Board members: Quentin Koffey, Michelle Brennan, Darlene Solomon, William Jellison, Wendy Lane, and Timothy Scannell.

This is significant because the directors may be found individually liable, which Kiani legal advisors claim serve as a stark warning to activist-installed directors that they cannot hide behind their director titles while they break the law.

The notice outlines how the Politan-led Board “resorted to knowing and wilful violations” of multiple provisions within the California Labor Code to avoid paying Mr. Kiani what he is rightfully entitled to under his employment agreement.

Kiani founded Masimo and the recent split with the new board has led to feuding with Kiani claiming that the individual respondents named in his action are liable for more than $100 million in statutory penalties – 65% of which would be payable to the State of California.

A spokesperson for the former CEO of Masimo said “Mr. Kiani took this action in response to the scorched earth and bad faith campaign by the Politan-led board of Masimo to avoid paying him what he is contractually owed after being forced out of the company he founded 35 years ago in his garage”.

“In addition to the lawsuit he brought to enforce the terms of his employment agreement, Mr. Kiani is seeking to hold the company and each of its six Politan-affiliated directors accountable for their unlawful conduct under California’s Private Attorney General Act. These claims carry potential statutory penalties of more than $100 million, with 65% of any recovery payable to the State of California.”

As for where the current Masimo Consumer business which was split into a separate entity the business has been classified as “held for sale” and moved into “discontinued operations.” on Masimo books.

It will be removed from Masimo’s non-GAAP financials, and the company will no longer provide guidance for the Non-healthcare segment.

Sound United as the business is now being referred to is, for all intents and purposes, a nonentity despite the business who have their own subsidiary in Australia still developing and selling new products with several scheduled for release this year.

Under the new board Masimo Health only managed to grow revenues 2%, they also booked a net loss of $486.9 million being the write down of the Sound United business.

During a conference call last week CFO Micah Young chose his words carefully, telling analysts that in regard to the divestment of Sound United, “[W]e are in the later stages of the process. We will not be commenting further on it during this call, but we remain pleased with the level of interest and our general expectations around timing remain unchanged.”

The timing he’s referring too is the first quarter of 2025 which could be interpreted as being a sale is imminent.

In their latest financials Masimo reported that the former Sound United business generated revenues of A$1.113 billion last year down $73.4 million or 9.5% compared to revenues of $772.6 million in Fiscal 2023.

The company claimed that a drop in consumer spending and higher interest rates “which affected the market for high-end audio systems, and home entertainment components and systems.” contributed to the downturn.