Certainly! I will provide a comprehensive analysis of Trump Media’s successful motion to dismiss all counts in the stock lockup case. The main contents of the report are as follows:
- Case overview: Background and parties involved in the litigation.
- Legal arguments: Claims presented and dismissal rationale.
- Court ruling: Judicial reasoning and case disposition.
- Contextual factors: Political immunity and parallel proceedings.
- Broader implications: Market impact and future legal exposure.
Trump Media Secures Complete Dismissal of Stock Lockup Case: Legal Analysis and Implications
1 Case Overview and Background
On September 2, 2025, the Delaware Court of Chancery delivered a significant legal victory to Trump Media & Technology Group (TMTG), the parent company of Truth Social, by granting its motion to dismiss all counts in a lawsuit brought by United Atlantic Ventures LLC (UAV) . UAV, an affiliate of former Apprentice contestants Andy Litinsky and Wesley Moss, had alleged that Trump Media engaged in retaliatory practices by locking up their shares following disputes over management and ownership stakes .
The lawsuit emerged from complex post-merger governance disputes that arose after Trump Media became a public company through a special purpose acquisition company (SPAC) merger with Digital World Acquisition Corp. (DWAC) in March 2024 . Litinsky and Moss, who helped facilitate the merger that took Trump Media public, claimed they were entitled to approximately 11 million shares (representing about 5% of the company’s stock) but alleged that Trump Media was preventing them from accessing these shares .
2 Legal Arguments and Claims
2.1 Plaintiff’s Allegations
United Atlantic Ventures presented several key claims in their complaint:
- Retaliatory Share Lockup: UAV alleged that Trump Media intentionally locked up their shares as retaliation for governance and management disputes that occurred prior to the merger .
- Share Diligation: The plaintiffs claimed that Trump and his business allies attempted to dilute their ownership stake in the company following disagreements .
- Breach of Agreements: UAV argued that Trump Media breached previous agreements regarding their entitlement to shares following the SPAC merger .
2.2 Defense Arguments
Trump Media’s legal team, represented by DLA Piper LLP, mounted a multi-faceted defense:
- Lack of Factual Support: The defense argued that UAV’s claims were based on “conspiracy theories” rather than substantiated factual allegations .
- Corporate Law Principles: Trump Media maintained that their actions were consistent with standard corporate governance practices and within their legal rights .
- Presidential Immunity: President Trump’s legal team (represented by Halloran Farkas & Kittila LLP) raised novel presidential immunity arguments, though the court ultimately did not address these claims in its ruling .
3 Court Ruling and Rationale
3.1 Vice Chancellor’s Assessment
Vice Chancellor Lori Will issued a comprehensive 57-page opinion that systematically addressed each of UAV’s claims . The court found that:
- No Viable Claims: The judge determined that “none of UAV’s claims survive” scrutiny under Delaware corporate law, characterizing their arguments as “conspiracy theories unsupported by factual allegations” .
- Dismissal with Prejudice: The majority of the case was dismissed with prejudice, meaning UAV cannot refile these specific claims in the Delaware Court of Chancery .
- Limited Without Prejudice Dismissal: Two claims were dismissed without prejudice, with the court deferring to a parallel lawsuit ongoing in Florida courts regarding a separate services agreement .
3.2 Judicial Reasoning
Vice Chancellor Will’s decision rested on several key judicial principles:
- Delaware Corporate Law Precedents: The ruling applied established principles of Delaware corporate law, which emphasizes business judgment rule deference to corporate decision-making .
- Factual Insufficiency: The court found that UAV failed to provide sufficient factual evidence to support their claims of retaliation and conspiracy .
- Forum Considerations: For the claims dismissed without prejudice, the court determined that the Florida court had stronger interest in resolving disputes involving Florida law and contracts for services performed primarily in Florida .
4 Contextual Factors and Parallel Proceedings
4.1 Presidential Immunity Question
Notably, the court declined to address the novel question of presidential immunity raised by President Trump’s legal team . This avoidance suggests the judiciary’s preference to decide cases on established legal grounds rather than venturing into unprecedented constitutional territory, especially given that Trump raised the immunity defense after winning his second term .
4.2 Related Litigation Landscape
The Delaware case represents just one front in a multi-jurisdictional legal battle between Trump Media and its early investors:
- Florida Proceedings: A parallel lawsuit continues in Florida courts regarding a separate services agreement between the parties .
- ARC Global Litigation: Another early investor, ARC Global (led by Patrick Orlando), previously won a ruling that Trump Media breached agreements and owed additional shares .
- Federal Court Action: UAV successfully obtained a federal court order requiring Odyssey Transfer and Trust Co. to release their shares once lockup restrictions expired .
Table: Overview of Related Trump Media Legal Proceedings
| Case | Jurisdiction | Parties | Status | Key Issue |
|---|---|---|---|---|
| UAV v. TMTG | Delaware Chancery Court | United Atlantic Ventures vs. Trump Media | Dismissed (Sept 2025) | Share lockup retaliation claims |
| UAV v. Odyssey | Federal Court | United Atlantic Ventures vs. Transfer Agent | Summary judgment for UAV (Aug 2025) | Share release requirements |
| ARC Global v. TMTG | Delaware Chancery Court | ARC Global vs. Trump Media | Partial victory for ARC (Sept 2024) | Breach of agreement on share conversion |
| Florida Services Case | Florida Courts | Trump Media vs. UAV | Ongoing | Services agreement disputes |
5 Broader Implications and Market Impact
5.1 Corporate Governance Considerations
The ruling reinforces several important principles in SPAC governance and post-merger disputes:
- Business Judgment Deference: Courts continue to show significant deference to corporate decisions made by boards and management .
- Delaware’s Role: The decision reaffirms Delaware’s position as a forum that applies established corporate law principles consistently, even in politically sensitive cases .
- Investor Expectations: The case highlights the importance of clear agreements and documentation in SPAC transactions, particularly regarding founder shares and post-merger governance .
5.2 Market and Financial Impact
The legal victory comes at a critical time for Trump Media, which has experienced significant stock volatility and valuation challenges:
- Stock Performance: Trump Media shares have declined approximately 84% from their March 2024 peak of $79.38, recently trading around $12-17 per share .
- Market Capitalization: The company’s market cap has fallen from nearly $10 billion at its debut to approximately $3.3 billion by September 2024 .
- Insider Selling Concerns: The case unfolded against the backdrop of lockup expirations that allowed insiders, including President Trump, to potentially sell shares .
5.3 Political Dimensions
As with many aspects of Trump-related enterprises, the case contained political undertones:
- Election Influence: Trump Media’s stock performance has been closely tied to political prognostications about President Trump’s electoral prospects .
- Immunity Arguments: The presidential immunity defense, though not addressed by the court, introduces novel questions about the intersection of corporate law and presidential powers .
6 Conclusion: Legal and Business Significance
The complete dismissal of all counts in the stock lockup case represents a significant legal victory for Trump Media and its leadership. The ruling eliminates a major litigation overhang that had created uncertainty about ownership stakes and governance practices within the company.
From a legal perspective, the decision demonstrates that even highly politicized corporate disputes will be judged based on established principles of corporate law rather than conspiracy theories or political considerations. Vice Chancellor Will’s rigorous application of Delaware corporate law precedents reinforces the state’s reputation as a predictable forum for business disputes.
From a business perspective, the resolution of this case removes one distraction for a company that continues to face substantial challenges. Despite its high profile and connection to President Trump, Trump Media has struggled financially, reporting multimillion-dollar net losses on minimal revenue . The company’s future prospects remain closely tied to both the success of Truth Social and the political fortunes of its majority owner.
The dismissal does not entirely resolve all conflicts between Trump Media and its early investors, as parallel proceedings continue in Florida courts. However, it represents an important milestone in clarifying the legal relationships and obligations between the parties. As Trump Media continues to navigate its path as a public company, this decision provides greater clarity on the limits of shareholder challenges to corporate governance decisions.