President-elect Donald Trump is employing a strategic legal maneuver to halt a significant lawsuit targeting his company, Trump Media & Technology Group Corp. (TMTG), the parent company of the controversial social media platform, Truth Social. In a December 6th filing with the Delaware Chancery Court, Trump’s legal team, representing him alongside FBI chief nominee Kash Patel and former Congressman Devin Nunes, invoked “temporary presidential immunity” as a shield against the claims.
The lawsuit stems from accusations leveled by Andy Litinsky and Wes Moss, former contestants on Trump’s reality TV show “The Apprentice.” They allege Trump unfairly diluted their 8.6% stake in TMTG, effectively excluding them from the company’s initial public offering (IPO). This alleged action significantly devalued their investment, considering they sold approximately $11 million in Truth Social shares in September – shares worth an estimated $150 million at their peak.
Trump, however, counters these claims with a lawsuit filed in Florida state court. He argues that Litinsky and Moss violated their agreement regarding the establishment of Trump Media and therefore aren’t entitled to the disputed stake. This counter-offensive underscores the complex web of legal battles surrounding Trump and his business ventures. The situation highlights the high-stakes financial implications, particularly given Trump’s status as the largest shareholder, controlling 60% of TMTG. He’s publicly committed to not selling his shares, despite the significant drop in value after the company’s public listing, a drop partially reversed following his recent election victory.
This latest legal move builds upon the U.S. Supreme Court’s July ruling on presidential immunity, a precedent Trump has actively leveraged in confronting various legal challenges. While federal cases have been dismissed under this claim, significant state-level prosecutions persist in New York and Georgia. The timing of this legal action is also noteworthy, occurring just after Trump Media reported a 6% decline in third-quarter net sales compared to the previous year, totaling a mere $1.01 million, with all revenue stemming from Truth Social advertising.
The market reacted to the news with a mixed response. DJT shares (the ticker symbol for Trump Media) experienced a 1.73% increase on Monday, closing at $35.34, only to dip slightly by 0.25% to $35.25 in after-hours trading. Nevertheless, year-to-date, DJT shares have seen a remarkable surge of 102.52%, according to Benzinga Pro data. The ongoing legal battle and its potential outcomes will undoubtedly continue to influence the volatile trajectory of TMTG and its stock price. The case serves as a fascinating case study of the intersection of high-stakes business dealings, presidential immunity claims, and the ever-shifting landscape of social media.
