Donald Trump is suing two co-founders of Trump Media and Technology Group (TMTG), the parent company of his Truth Social network, claiming that they set up the company improperly and should lose their stock in the venture.
TMTG went public last week, enjoying a remarkable debut on the Nasdaq exchange with shares trading at a high of $78 before plunging days later as the company’s extraordinary 2023 losses came to light – leading some to warn that it is the latest example of a volatile “meme stock” offering that has little underlying value.
Now, the Republican presidential candidate has filed a new lawsuit against Andy Litinsky and Wes Moss, two former contestants from his NBC reality show The Apprentice turned co-founders of the company.
Mr Litinsky and Mr Moss originally filed a complaint in February in the Delaware Court of Chancery, seeking to prevent Mr Trump from taking steps the two said would sharply reduce their combined 8.6 per cent stake in TMGT.
The pair claimed that they own the stake through a 2021 agreement Mr Trump signed with their company United Atlantic Ventures.
On 24 March, Mr Trump posted a filing in Sarasota County, Florida, civil court, claiming that the duo “spectacularly” mishandled an attempt to take TMGT public several years ago and subsequently attempted to “thwart the deal”, allegedly putting the whole project “on ice” for more than a year and a half.
The Republican further accuses his collaborators of failing “at every turn”, making “wasteful decisions” and causing “significant damage” to TMGT’s prospects.
His suit also targets the pair over their Delaware filing, arguing that it is one of several attempts they have made to block TMTG’s ultimately successful plan to go public. That goal was eventually accomplished last month by merging it with a publicly-traded shell company called Digital World Acquisition.
Mr Trump is seeking damages after accusing Mr Litinsky, Mr Moss and co-defendant Patrick Orlando of “breaches of fiduciary duty”. He is also seeking to bar them from owning shares or appointing any members to the company’s board.
Former president Donald Trump is demanding Truth Social co-founders lose shares
(AP)
Shares in the company have continued to fluctuate wildly since its Wall Street debut last Thursday.
On Tuesday, the stock closed at $51.60, up 6 per cent on Monday’s outcome, leaving the company as a whole valued at around $5.9bn.
As matters stand, Mr Trump must wait six months before selling off his lucrative interest in TMTG but he may well be tempted to try to make that happen sooner, given the huge legal expenses he is wracking up.
Mr Trump is fighting four criminal indictments and 88 felony charges in four jurisdictions in tandem with his presidential run.
His numerous court cases were reported to have cost him $230,000 a day in February. He was also recently forced to place bonds worth $91.6m and $175m in order to appeal two separate New York civil judgements against him.
Robert Johnson is a UK-based business writer specializing in finance and entrepreneurship. With an eye for market trends and a keen interest in the corporate world, he offers readers valuable insights into business developments.
