Occam's Razor
Michael is simply an asshole and a bully, and not a good lawyer either.
I've had enough interaction with the man to know he's on a short list of people I would not want to work with. Mature adults settle their disputes without public temper tantrums (on websites they control).
This is a small time deal. Airing it out like this says more about Michael Arrington and how he deals with anyone who slights him than anything. Would you want to be his contractor, for anything, knowing he could turn on you and trash you like this? No thanks.
His product was a piece of crap, and he should have been a man and cut his losses on this one. He's not an engineer. He was just some ex lawyer with a bit of money and perceived influence who was bossing some eager hustlers from SE Asia around. If he really knew how to design a cutting edge product, and really had any business sense, he would not have gotten himself into a no contract, no name outsource mfr situation like this.
I am glad it bit him in the ass, and that he is so unaware of what an asshole he is that he is broadcasting this to the world. Usually people are more clever about hiding this sort of thing, but no contractor can go into a deal with this guy and claim they did not see any red flags that he's just an unpleasant, high risk client.