Lawsuit Filed Against Trump Media & Technology Group Co-founders Over Share Dispute

In a recent development, the media company, Trump Media & Technology Group, has filed a lawsuit against its co-founders, Wesley Moss and Andrew Litinsky, accusing them of failing to launch the company successfully and attempting to sabotage the deal.

The lawsuit, filed in Sarasota County, Florida, civil court, aims to prevent Moss and Litinsky from appointing members to the company's board or owning any shares. The legal action alleges that a 2021 agreement signed by Donald Trump with a company founded by Moss and Litinsky entitled them to an 8.6% undiluted share of Trump Media's total stock.

Dispute Over Shares and Company Performance

At DJT's closing price on a recent Tuesday, the share in question would be valued at approximately $601 million. In February, Moss and Litinsky had filed a lawsuit against Trump Media in Delaware Chancery Court regarding their stake in the company. The latest lawsuit in Florida seeks damages for alleged breaches of fiduciary duty by Moss and Litinsky, along with accusations against DWAC founder Patrick Orlando for his involvement in these breaches.

The legal action comes in the wake of shareholders in Digital World Acquisition Corp. approving a merger with Trump Media, following which the newly public Trump Media began trading under the ticker DJT. Although its stock soared by as much as 50% in its Nasdaq debut, a subsequent disclosure of a $58.2 million net loss in 2023 led to a sharp decline in the share price.

Allegations Against Co-Founders

According to Trump Media, Moss and Litinsky were responsible for establishing the company's corporate governance structure, preparing the launch of the social media app Truth Social, and finding a shell company for the merger. However, the company alleges that the co-founders failed at every stage, leading to wasteful decisions and significant damage to Trump Media. They also claim that the decision to pursue a merger with Benessere Capital Acquisition Corp. triggered an investigation by the Securities and Exchange Commission due to a conflict with DWAC.

Response to Allegations

Trump Media contests the claim that Moss and Litinsky are owed stock and asserts that the services agreement signed with their company in 2021 is no longer valid. The lawsuit further alleges that after Trump's representatives raised concerns about the agreement in July 2021, Eric Trump informed the company that the agreement had been deemed void by his father. Lawyers representing Trump Media did not immediately respond to requests for comment on the lawsuit, while Moss and Litinsky could not be reached for immediate comment.