Share this @internewscast.com

Former President Donald Trump was accused in a lawsuit Wednesday of trying to “drastically dilute” the value of stock shares in his social media company held by the firm’s co-founders, potentially depriving themof hundreds of millions of dollars in profits.

The partnership, United Atlantic Ventures alleges that Trump Media & Technology Group engaged in “wrongful 11th hour … maneuvering” to dilute UAV″s minority stake in the media company, a court filing says.

The Delaware Chancery Court lawsuit comes in advance of the planned merger of TMTG with a shell company called Digital World Acquisition Corp., which would result in the shares of the combined entity being publicly traded.

If DWAC shareholder approve the merger next month, Trump’s 90% stake in TMTG could be valued at more than $3 billion, given DWAC’s current share price.

UAV is a partnership of Andy Litinsky and Wes Moss, who initially pitched Trump the idea of creating Trump Media in February 2021, after the former president was banned from Twitter and Facebook following the deadly Jan. 6 Capitol riot.

Both Litinsky and Moss were contestants on Trump’s television show, “The Apprentice.”

TMTG later built and launched Truth Social, the social media platform that Trump uses almost exclusively to communicate with the public.

The planned merger comes as Trump, who is the leading candidate for the Republican presidential nomination, has been ordered to pay more than $500 million in civil judgments in New York, related to trial verdicts for business fraud and defamation of the writer E. Jean Carroll.

“The attempt here is to deprive them of the deal,” said Christopher Clark, a lawyer for UAV.

“It’s not like they went out and bought a lottery ticket,” Clark said of the co-founders. “They actually went out and did the work, they created Truth Social, and now the beneficiary of that, Donald Trump, doesn’t want to pay.”

“Not a unique story, unfortunately,” Clark said, referring to Trump’s infamous practice of contesting bills from contractors and lawyers.

CNBC has requested comment from spokesmen for Trump, TMTG and DWAC about the lawsuit.

“Former President Donald J. Trump … is causing TMTG to not only dispute UAV’s established right to 8,600,000 shares or 8.6% of TMTG’s issued and outstanding stock, but also attempting to drastically dilute UAV’s interests in connection with an impending merger,” a motion in the Delaware suit says.

That motion claims that UAV’s current 8.6% stake in Trump’s company would be diluted to less than 1% as a result of the TMTG board approving an eight-fold increase in the total number of authorized shares in the firm, from 120 million shares to 1 billion shares.

“There is no legitimate business purpose for the Billion Share Authorization or the creation of non-voting stock in the face of the pending Merger, particularly because any unissued TMTG stock will be cancelled in the Merger,” the motion by UAV says.

“The only plausible reason for TMTG to authorize this massive new block of stock and create non-voting stock is so Trump can dilute UAV and take the lion’s share of merger consideration for himself,” the motion says.

UAV’s lawsuit against TMTG, which is seeking injunctive relief against the dilution effort, is sealed for now in the Delaware court, which as a rule intitially keeps complaints off of its public docket until the parties agree on any necessary redactions.

But a motion by UAV asking a judge to expedite the suit is public. That motion details the claims in the complaint.

In October 2021, TMTG and DWAC, which is a so-called special purpose acquisition company, announced a plan to merge.

That merger was delayed for more than two years by investigations launched by the Securities and Exchange Commission and the Department of Justice, among other factors.

But earlier this month, the SEC said that the merger’s registration statement was effective, essentially green lighting the SPAC merger. DWAC shareholders are scheduled to vote on potential approval of the merger March 22.

DWAC appears to have known this lawsuit might be coming, according to a Feb. 14 filing with the SEC.

“UAV also communicated to TMTG and to a holder of TMTG Convertible Notes that it may pursue an action to enjoin consummation of the Business Combination,” that DWAC filing said.

“Although TMTG advised DWAC that it firmly believes that neither UAV nor Mr. Cohen possess any anti-dilution or consent rights with respect to the Business Combination, if such claims involve the issuance of additional shares in connection with the Business Combination and such claims were determined valid, settlement of such claims could have a material adverse effect from a monetary and dilutive impact (both from an economic and voting standpoint) on the Combined Entity and its stockholders,” the filing said.

Share this @internewscast.com
You May Also Like
Monday Morning Minute: Running on Empty

Gavin Newsom Subtly Shifts Stance on Charlie Kirk, Aiming for Minimal Public Attention

In February, a surprising announcement stirred the political landscape: Charlie Kirk, the…
New Emails Tie Epstein to Mossad’s Syrian Backchannel

Explosive Emails Reveal Jeffrey Epstein’s Secret Connection to Mossad’s Syrian Diplomacy

A new investigation by DropSite News is raising fresh questions about the…
LA firefighters ordered to leave fire that exploded into Palisades Fire days later: report

Controversial Decision: LA Firefighters Withdrawn from Site Prior to Palisades Fire Eruption

Firefighters responding to a small brush fire in Los Angeles, initially managed…
Halloween threat puts kids in danger as drug-laced sweets spook parents, trick-or-treaters: expert

Expert Warns of Drug-Laced Sweets Threatening Children’s Safety This Halloween

As Halloween approaches, children nationwide are getting ready to don their costumes…
JD Vance says UFOs, aliens could be ‘spiritual forces’ as VP vows to ‘get to the bottom’ of mystery in skies

JD Vance Suggests UFOs and Aliens May Be ‘Spiritual Forces’; Vice President Commits to Unveiling Sky Mysteries

Vice President JD Vance recently offered his perspective on UFO mysteries, proposing…
Newark-bound JetBlue passengers hospitalized after emergency landing in Tampa

JetBlue Flight Makes Emergency Tampa Landing, Sends Newark-Bound Passengers to Hospital

A JetBlue flight en route to Newark experienced a dramatic altitude drop,…
National Guard in each state is ordered to create 'quick reaction forces' trained in civil unrest

State-by-State Mandate: National Guard to Establish Rapid Response Units for Civil Unrest Management

In a move underscoring the Trump administration’s commitment to rapidly deploy military…
Trump appears to suggest the US will resume testing nuclear weapons for first time in 30 years

Trump Hints at Possible Resumption of US Nuclear Weapons Testing After 30-Year Hiatus

In a move that could signal a dramatic shift in U.S. nuclear…
SNAP food aid shutdown: Governor JB Pritzker signs order supporting Illinois residents who rely on SNAP benefits

Governor Pritzker Takes Bold Action to Safeguard SNAP Benefits for Illinois Families Amid Aid Shutdown

CHICAGO (WLS) — In a crucial move to support those dependent on…
Fox News ‘Antisemitism Exposed’ Newsletter: Will New York City's next mayor hate Jews?

Fox News Investigates: Could New York City’s Next Mayor Be Antisemitic?

Fox News’ “Antisemitism Exposed” newsletter delivers critical insights on the increasing anti-Jewish…
Oregon child attacked by coyote during game of hide-and-seek in backyard; state officials sound alarm

Coyote Attack in Oregon Backyard: Child Injured During Hide-and-Seek, Officials Warn Public

A young child in Oregon had a close call with a coyote…
Vehicle owner uses GPS app to track Naperville Ford dealership employee driving his SUV on 'unauthorized rides'

SUV Owner Uncovers Unauthorized Joyrides by Dealership Employee Using GPS App in Naperville

NAPERVILLE, Ill. — When you bring your car to a dealership for…