Donald Trump has filed a lawsuit against his co-founders of Truth Social, seeking to acquire their shares in the company. He claims that they have mishandled their responsibilities and do not deserve to have ownership in the company.
According to Bloomberg, a lawsuit was filed on March 24 in a Florida state court against Andy Litinsky and Wes Moss, former business associates of Trump. These individuals currently hold an 8.6 percent stake in the company, valued at around $606 million. Trump’s attorneys have stated that he is seeking to have this stake completely eliminated.
Litinsky and Moss filed a lawsuit against Trump in a Delaware court in February, alleging that the former president and other executives conspired to deny them their fair share in the company.
According to Trump’s lawsuit, Litinsky and Moss are accused of not properly establishing the corporate governance structure for Trump Media and failing to find a suitable merger partner. These alleged failures would disqualify them from benefiting from the company going public. On the other hand, Litinsky and Moss’s lawsuit against Trump claims that he attempted to obtain millions of additional shares, which would have reduced their ownership stake in the company.
According to Bloomberg, the share price of Truth Social, the advertising-driven revenue source for its parent company Trump Media, experienced a significant drop of 21 percent on Monday. However, it managed to stabilize by Tuesday. This volatility can be attributed to the sobering SEC filings released on Monday, which unveiled that Truth Social incurred a staggering loss of $58 million in the previous year. Furthermore, the filings disclosed that Truth Social only generated $751,000 in its final quarter of 2023.
Trump’s ownership of Truth Social has boosted his estimated net worth, which had suffered a decline due to mounting legal expenses and substantial court defeats, leaving him liable for hundreds of millions of dollars.
As of Tuesday, the value of the former president’s stake in Trump Media was approximately $4 billion, accounting for just under 60 percent of the company. However, due to an agreement made with the special purpose acquisition company he merged with to go public, Trump will have to wait six months before he can cash out on his shares.
According to Bloomberg, Delaware judge Sam Glasscock III was taken aback when he learned about Trump’s lawsuit in Florida. Glasscock expressed his surprise on Monday and stated that he would consider imposing sanctions against Trump in the Delaware case due to the Florida filing.
