'Land grab': Expert doubts Trump will succeed in suit over 'mismanaged' Truth Social
April 03, 2024
Donald Trump filed a lawsuit against two co-founders of his social media site, Truth Social, claiming their "mismanagement" in 2023. After the stock went live last week, the stock price of the company declined.
Trump alleged in the suit filed this week that Andy Litinsky and Wes Moss aren't entitled to their shares of DJT stock.
However, one CNBC finance reporter doesn't know how Trump will win such a lawsuit, given the company has been "mismanaged" from the start.
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Speaking to MSNBC host Katy Tur on Wednesday, Ron Insana, a former hedge fund manager, said he's "not sure" how Trump can carry out the lawsuit.
"It seems like a land grab to get $440 million worth of stock back into his hands," said Insana.
The price of the stock was higher when he filed the lawsuit than it was Wednesday. Trump's corporate stock surged as high as $79 per share the week it opened. It now stands at a little over $49.
Trump's suit is asking for $454 million, which isn't far off of his civil fraud trial penalty in New York.
"Those two gentlemen, by the way, are suing Donald Trump, alleging that he's trying to increase the outstanding number of shares in DJT, which would dilute their ownership. It's a two-way lawsuit," continued Insana.
He noted that it's also difficult to tell what specifically Trump is suing the men for.
"This was a phenomenal opportunity for Moss and Litinsky," the suit says, claiming that the men were both "riding President Trump's coattails."
"Without President Trump, Truth Social would have been impossible," it then says.
"They made a series of reckless and wasteful decisions at a critical time that caused significant damage to [Trump Media and Technology Group] TMTG and a decline in the stock price of its merger partner," the filing continues.
It's "very hard to tell exactly what he's suing them for given that the company has not been managed terribly well at any step along the way," Insana told MSNBC. "It took in about $4 million last year and lost nearly $60 million. So, I'm not quite sure who's exactly to blame for the poor performance of the social media company that, in size, revenue, profits, pales in comparison to any vehicle that's out there."
See his full comments in the video below or click here.
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