Tinder founders sue IAC claiming company robbed them of stock options

A group of founders, current executives as well as early employees of Tinder sued the dating app’s owner IAC as well as its subsidiary Match Group for at least $2 billion, claiming the defendants “robbed Tinder employees” by cooking financial information, “undermining Tinder’s valuation as well as unlawfully stripping away their Tinder stock options.”

Plaintiffs within the case filed in brand-new York State Supreme Court in Manhattan include Tinder founders Sean Rad, Justin Mateen as well as Jonathan Badeen, as well as three current senior executives.

The suit alleges a scheme in which IAC as well as Match manufactured a “lowball” valuation of Tinder as well as then “extinguished Tinder stock options entitling the employees to valuations in 2017, 2018, 2020 as well as 2021,” which let the defendants pocket the money that will otherwise would likely have been owed to the plaintiffs.

“We were always concerned about IAC’s reputation for ignoring their contractual commitments as well as acting like the rules don’t apply to them,” said Rad, Tinder’s first CEO.

“yet we never imagined the lengths they would likely go to cheat all the people who built Tinder. The Tinder team – especially the plaintiffs who are currently senior leaders at the company – have shown tremendous strength in exposing IAC/Match’s systematic violation of employees’ rights.”

In response, IAC as well as Match Group issued their own statement:

“The allegations within the complaint are meritless, as well as IAC as well as Match Group intend to vigorously defend against them,” the companies said. “Since Tinder’s inception, Match Group has paid out in excess of a billion dollars in equity compensation to Tinder’s founders as well as employees. With respect to the matters alleged within the complaint, the facts are simple: Match Group as well as the plaintiffs went through a rigorous, contractually – defined valuation process involving two independent global investment banks, as well as Mr. Rad as well as his merry band of plaintiffs did not like the outcome.”

“Mr. Rad (who was dismissed coming from the Company a year ago) as well as Mr. Mateen (who has not been with the Company in years) may not like the fact that will Tinder has experienced enormous success following their respective departures, yet sour grapes alone do not a lawsuit make. Mr. Rad includes a rich history of outlandish public statements, as well as that will lawsuit contains just another series of them. We look forward to defending our position in court.”

In addition to various other claims, the suit accuses IAC as well as Match of designating Greg Blatt, Match’s chairman as well as CEO, as interim CEO of Tinder in December 2016 to allow them to “control the valuation of Tinder” as stock options for Tinder employees were set to be valued.

Blatt is actually referred to within the complaint as “a longtime lackey of IAC’s controlling shareholder Barry Diller,” who “had a well-earned reputation as a notorious bully that has a volcanic temper as well as a habit of threatening to fire employees who contradicted him.”

The suit also accuses Blatt of groping as well as sexually harassing Tinder’s vice president of marketing as well as communications, Rosette Pambakian, at Tinder’s 2016 holiday party in Los Angeles. Pambakian is actually one of the plaintiffs within the lawsuit.

“Because a credible investigation — let alone a firing in public view — would likely have derailed their scheme, Defendants whitewashed Blatt’s misconduct,” the suit alleges.

“yet just two weeks after their scheme concluded, Defendants publicly announced Blatt’s ‘retirement’ — rewarding him that has a lucrative golden parachute as well as a glowing farewell message coming from Diller praising Blatt’s ‘integrity,'” the complaint said.

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