Brief:

• Match Group, owner of online dating services Tinder and Match.com, sued dating app Bumble last week for infringing on two of its patents, according to Recode. The company claims that Bumble executives Chris Gulczynski and Sarah Mick, who both previously worked at Tinder, stole confidential information about proposed Tinder features.
• The lawsuit follows Match Group's offer last year to buy Bumble, the "women-first dating app," for $450 million. An unnamed source told Recode that Match Group is still interested in acquiring Bumble and is using the lawsuit as a bargaining chip.
• Bumble's number of registered users last year jumped 70% to more than 22 million, compared to Tinder's 46 million, according to Forbes. Bumble was set to make more than $100 million in revenue in 2017, a figure that's projected to double in 2018.

Insight:

Match Group's lawsuit against Bumble must be considered in the context of any acquisition talks between the companies. By claiming that Bumble infringed on Match's patents by copying its "swipe-to-connect" app gesture and a proposed Tinder feature to let users retrieve the folks they accidentally skipped, Match appears to be negotiating leverage in the takeover talks that so far haven't led to a deal.

If true, it's certainly an unconventional way to encourage Bumble to join the Match Group portfolio. By accepting the buyout, Bumble could presumably make the lawsuit go away.

Bumble's rapid growth comes at a prescient time as women's empowerment issues gain more attention with the #MeToo movement that publicizes sexual harassment in the workplace. The company seeks to expand beyond the dating app market, which presumably loses customers who find mates, to reach a broader group of mobile users. Bumble last year started "Bumble BFF" and a business feature called BumbleBizz that gives women control over making the first professional networking move, per TechCrunch.

Match has grown steadily by acquiring other dating apps like OKCupid and PlentyOfFish over the years in an effort to dominate the market. Bumble would be a nice addition to its portfolio, given its rapid growth and ability to cannibalize users from other dating apps. Match's Tinder app also has sought to copy Bumble's key feature of letting women make the first move. The time may be right for Bumble to sell itself before more competitors move in on its space.