Donald Trump’s recently taken public media company is suing its co-founders, accusing them of “catastrophically” failing to get the company off the ground and then trying to “sabotage the deal.”
Civil court seeks ban on lawsuit filed in Sarasota County, Florida. Trump Media & Technology GroupCo-founders Wesley Moss and Andrew Litinski are prohibited from serving on the company’s board of directors or owning stock.
Mr. Moss and Mr. Liczynski are under a 2021 agreement signed by Mr. Trump with United Atlantic Ventures LLC, a company he founded, giving them an 8.6% stake in Trump Media, with no dilution through the issuance of new stock. It claims to be guaranteed.
At DJT’s closing price Tuesday, that stock would be worth about $601 million.
In February, Mr. Moss and Mr. Liczynski filed a lawsuit in Delaware Chancery Court over their shares in Trump Media.
The lawsuit, made public Tuesday, was filed in late March around the same time that the shell company’s shareholders filed suit. Digital World Acquisition Corporation has voted to approve a merger with Trump Media, the private company that operates the upstart social media app Truth Social.
Shares of newly public Trump Media, which began trading under the ticker DJT after a special purpose merger, soared 50% on its Nasdaq debut last week.
However, the stock plunged on Monday after the company announced a net loss of $58.2 million for 2023.
Trump Media’s lawsuit filed in Florida asks a court to award damages to Moss and Lichinski for “breach of fiduciary duty.”
In addition to Moss and Liczynski, the lawsuit names DWAC founder Patrick Orlando as a co-defendant and is accused of participating in these breaches.
According to the Florida lawsuit, Moss and Liczynski were responsible for establishing Trump Media’s corporate governance structure, preparing for the launch of Truth Social, and finding a shell company to merge to take the media company public. It is said that he suffered a loss.
Moss and Liczynski, both former contestants on former President Trump’s reality show “The Apprentice,” have failed “at every turn,” Trump Media claims. .
They made “futile decisions” that caused “significant harm” to Trump Media and caused DWAC’s stock price to decline, the company claims. According to the lawsuit, they pursued a merger with Benessere Capital Acquisition Corp. of Orlando, even though business conflicts with DWAC ultimately triggered an investigation by the Securities and Exchange Commission. It is said that he selected.
Moss and Liczynski then “decided to retaliate” by suing the soon-to-be-public company on the eve of the Trump Media-DWAC merger vote, according to the complaint. report By Bloomberg.
Trump Media says claims that UAVs are owed equity are “baseless” and that the services agreement President Trump signed with UAVs in 2021 is no longer valid.
After President Trump’s representatives raised concerns about the agreement in July 2021, Eric Trump sent a letter to UAV stating that his father “deemed” the agreement to be “null and void,” according to the complaint. . The UAV allegedly “tacitly acknowledged” President Trump’s decision to void the contract.
A lawyer for Trump Media did not immediately respond to CNBC’s request for comment on the lawsuit. Mr. Liczynski and Mr. Moss could not immediately be reached.
