This likely started with Jawbone complaining to the authorities and then co-operating with the investigation. OP’s characterisation of these indictments as “a BS attempt by Jawbone's management to screw over a former competitor” would appear inchoate given the text of the indictments hasn’t yet been released.
That's not to say there aren't people who are essentially random victims of "prosecutorial discretion". Lawyers need something to do all day, and sometimes that thing is finding people to prosecute.
There is of course the third possibility, however unlikely, that the accused engaged in truly reprehensible and brazen theft of their former employer's intellectual property, showing such wanton disregard for civil society that they deserve to be deprived of their freedom and placed in a cage for several months, and then marked as ex-cons the rest of their natural lives. I would say there's a pretty miniscule chance of this being the case, but again, I don't know any of the details.
https://www.reuters.com/article/us-goldman-sachs-aleynikov-f...
What does this have to do with anything? Whether or not they are the reason jawbone is finished is irrelevant.
It's hard to know for sure without knowing exactly what Jawbone thinks has been stolen.
I would bet the reason Jawbone went this route is because their lawyers properly informed them that California's right to work laws would have a civil case thrown out in no time. So now we have a bunch of feds involved who need to reach their quarterly quota of prosecutions and these poor employees are going to go broke defending themselves in court.
Everyone at Jawbone can seriously go to hell.