San Francisco-based drone startup Lily Robotics shut its doors last month after announcing that it won't be shipping out its highly-anticipated Lily drone, which racked up over $34 million in pre-sales.
On Tuesday, Lily Robotics was allegedly raided by law enforcement agents for a "potential criminal investigation" against the company, according to a Forbes report citing an anonymous source familiar with the matter.
When contacted by Business Insider, a spokesperson for the San Francisco District Attorney said they "can neither confirm nor deny the existence of a criminal investigation."
The raid came less than a month after Lily was served a civil consumer protection suit by the San Francisco District Attorney, claiming that a promotional launch video misled potential customers about the drone's capabilities. The suit was filed on January 12, the day after Lily Robotics announced its closure.
Specifically, the suit alleged that some of the Lily drone's promotional footage, designed to represent the Lily drone's camera and auto-following capabilities, was not filmed with an actual Lily drone prototype, and further alleges that Lily Robotics did not have "a single Lily Camera prototype" containing the advertised features at the time of filming.
Instead, the San Francisco District Attorney states that the footage was taken with a GoPro camera attached to a Lily prototype, which did not yet have the auto-follow feature.
GoPro declined Business Insider's request for comment.
The San Francisco District Attorney also alleges that Lily Robotics did not disclose to the public that non-Lily devices were used to film other parts of the video. It claims the company used a professional drone, the $2,000 DJI Inspire drone, instead.
In an alleged email conversation between Lily Robotics CEO Antoine Balaresque and filmmakers hired to make the promotional video, Balaresque was apparently concerned that "lens geeks" could detect the "unique GoPro lens footprint." He allegedly followed his concern by saying "we should be extremely careful if we decide to lie publicly."
Business Insider has also tried contacting Balaresque, but has not been able to get in touch.
The Lily drone was highly anticipated because of the auto-follow feature: It promised no technical know-how or setup, but by carrying a small puck-like tracking device, you could just throw the drone into the air to activate it, and it would automatically follow and film you, so long as you were holding the tracker.
Lily Robotics also touted rugged water-proofing features that would differentiate it from other drones currently on the market, as well as the unique "throw-and-go" feature to activate the drone in mid-air.
Lily Robotics ran an extremely successful pre-order campaign on its website and raised up to $34 million in pre-orders for 60,000 units of the Lily drone.
Ultimately, Lily Robotics sent an email to pre-order customers that the company was unable to secure the necessary financing for manufacturing and shipping.
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