The CEO of Digital World Acquisition Group – the special purpose acquisition company (SPAC) that facilitated the initial public offering (IPO) of former President Donald Trump's social media company — was recently accused of orchestrating a corporate "coup" in a lawsuit.
CNBC reported this week that current Trump Media and Technology Group (TMTG) board member Eric Swider has been named as a defendant in a lawsuit recently filed in Florida. Plaintiffs Benessere Investment Group and ARC Global Investments II accused Swider and several others of carrying out a plot to force out the company's former CEO, Patrick Orlando, calling it "an audacious scheme to seize control of and enlarge their holdings."
According to a report from tech publication Wired, Swider was accused of enlisting the help of Orlando's former assistant, Alexander Cano, to gain access to an online cloud storage website to access sensitive files that were deemed the "lifeblood" of both the SPAC and TMTG.
READ MORE: Trump sues his Truth Social business partners after stock loses $4 billion in first week of trading
"At some point during 2023, months after Cano had left Benessere, Orlando learned that he had been locked out of the Box Account and that Cano had seized total control of the Box Account as the administrator," the lawsuit alleges. "Cano without authorization accessed files, including, without limitation, files containing all information with regard to all investors as well as all financial and other confidential information not only of ARC II but also of Benessere."
The lawsuit accused of Swider then using that information — which included Orlando's Mailchimp account and email list — to send a mass email to investors disparaging Orlando's business decisions. He specifically blamed Orlando for steering the SPAC "directly into the arms of the SEC, the DOJ, lengthy delays and costly investigations."
"Mr. Orlando is destroying the value that may be realized upon consummation of the business combination by the Company and its members," Swider wrote.
According to CNBC's report, Swider rewarded Cano for his role in the alleged scheme by making him president of the SPAC and awarding him a convertible note worth approximately 165,000 shares of TMTG stock, which at the time was worth roughly $6 million.
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TMTG, which is the entity that owns Trump's Truth Social microblogging platform, has seen its stock crater since its IPO was launched in late March. The stock has already lost roughly 45% in value, and all previous gains made after it first went public on the Nasdaq Composite have since been erased.
This is also far from the first lawsuit TMTG and its owners have been involved in. In February, Trump's business partners in the venture, Andy Litinsky and Wes Moss, sued the former president in Delaware Chancery Court for allegedly attempting to artificially increase the number of shares in the company to roughly one billion, rendering their 8.6% stake in the company essentially worthless. Trump, in turn, sued Litinsky and Moss in Florida after the stock's poor performance in the wake of the IPO, accusing them of botching the merger with the SPAC and failing in setting up the company's corporate governance structure.
In addition to the litigation, TMTG may have also scared off investors after a regulatory filing showed that the company suffered more than $58 million in losses in 2023 after making just $4 million in revenue, and that it needed the funding of the SPAC it merged with in order to stay operational.
Trump's 78 million shares in TMTG increased his net worth by nearly $5 billion when trading began, though he has since lost more than $2 billion in net worth due to the stock's underwhelming performance this month.
READ MORE: 'No legitimate business purpose': Trump sued by Truth Social business partners
