His newly established Trump Media & Technology Group Corp. has two co-founders, but Donald Trump has sued them, alleging they should not have any shares in the firm because they set it up all wrong.
Trump has accused Andy Litinsky and Wes Moss of violating an agreement over the setup and does not deserve their 8.6% ownership, which is presently valued at $606 million, in the latest legal spat over the distribution of the popular but struggling meme stock.
The case, previously undisclosed, was filed on March 24 in a Florida state court. It follows the pair’s earlier claim, filed in Delaware Chancery Court, against the former president over their promised interest in the social network firm.
Shares of Trump Media, which started trading last week after its merger with a particular purpose acquisition company, or SPAC, are seeing significant swings as the court battle unfolds. In a securities filing, Trump Media revealed a $58 million deficit and a slow income stream for 2023, causing the stock to tumble 21% on Monday. The company also restated its warning that it required the funds from the SPAC transaction to be operational.
As of Tuesday at 3:53 p.m.. In New York, the stock rose by 6.1% to $51.63.
Litinsky and Moss, according to Trump, were negligent in establishing Trump Media’s corporate governance structure, launching his Truth Social platform, and selecting a suitable merger partner. He claims the business suffered because of the setback. He claims that they began ceaseless attempts to thwart the blank check trade in the heat of competition for what was rightfully theirs. According to their separate lawsuit, Trump allegedly intended to obtain millions more shares, eroding their position.
The candidate for president in November, widely believed to be the Republican nominee, has witnessed a meteoric rise in his net worth thanks to his ownership in Trump Media. This wealth could be used to settle hundreds of millions of dollars in judgments filed against him. However, he is trapped in a lockup that prevents him from selling these shares for six months. Despite the downturn, Trump Media is still worth $7.05 billion on the market, and his potential earnings are directly proportional to the size of his stake. He stands to lose more money if the stock price were to fall.
