Donald Trump is taking legal action against his co-founders of Truth Social, aiming to gain control over their shares in the company. He claims that they have mishandled their responsibilities and do not deserve to have a stake in the company.
According to a recent report by Bloomberg, a lawsuit was filed on March 24 in a Florida state court against Andy Litinsky and Wes Moss, former business associates of Trump. The lawsuit aims to eliminate their 8.6 percent stake in the company, which is currently valued at around $606 million. Trump’s attorneys have expressed his desire to remove their ownership completely.
Litinsky and Moss filed a lawsuit against Trump in a Delaware court in February. They alleged that the former president and other executives conspired to unjustly deny them their rightful share in the company.
Trump’s lawsuit claims that Litinsky and Moss were negligent in setting up the corporate governance structure for Trump Media and in finding a suitable merger partner. According to Trump, these failures disqualify them from benefiting from the company’s initial public offering. On the other hand, Litinsky and Moss allege that Trump attempted to acquire millions of additional shares, which would have diminished their ownership stake in the company.
According to Bloomberg, Truth Social, the main source of revenue for its parent company Trump Media, experienced a 21 percent decrease in its share price on Monday. However, by Tuesday, the share price stabilized. The volatility can be attributed to the SEC filings released on Monday, which revealed that Truth Social incurred a significant loss of $58 million in the previous year. Additionally, the filings indicated that Truth Social generated only $751,000 in the last quarter of 2023.
Trump’s ownership in Truth Social has bolstered his estimated net worth, which had suffered a decline in recent months due to mounting legal expenses and court defeats that have left him responsible for substantial monetary damages.
The value of the former president’s ownership in Trump Media, which is slightly below 60 percent, reached around $4 billion on Tuesday. However, Trump is currently unable to sell his shares for the next six months. This restriction is a result of an agreement he made with the special purpose acquisition company that he merged with in order to take the company public.
According to a report by Bloomberg, Delaware judge Sam Glasscock III was completely taken aback when he heard about Trump’s lawsuit in Florida. Glasscock expressed his astonishment and mentioned that he would be looking into possible sanctions against Trump in the Delaware case due to the filing in Florida.
