Trump Media director accused of ‘hacking’ files in attempted corporate ‘coup’: lawsuit

Investment
firms
led
by
the
former
CEO
of
the
SPAC
that
merged
with

Donald
Trump‘s
media
company
allege
that
their
files
were
hacked
and
stolen
by
a
current
member
of
the
media
company’s
board
of
directors.

In
a
federal
civil

lawsuit
filed
in
South
Florida
last
month,
the
firms
accuse
board
member
Eric
Swider
of
plotting
a
coup
in
early
2023
to
replace
Patrick
Orlando
as
CEO
of
the
special
purpose
acquisition
company,
Digital
World
Acquisition
Corp.

As
part
of
that
attempted
ouster,
Swider
and
others
allegedly “stole
access”
to
the
firms’
computer
systems
and
then “used
the
stolen
information
to
attack”
Orlando,
according
to
the
lawsuit.

It
was “an
audacious
scheme
to
seize
control
of
and
enlarge
their
holdings,”
claims
the
suit,
which
was
filed
by
Benessere
Investment
Group
and
ARC
Global
Investments
II.

The
suit
seeks
damages
and
an
injunction “prohibiting
the
use
of
the
stolen
information
and
to
stop
the
Defendants
hacking”
the
firms’
files.

Orlando
was

fired
from
Digital
World
in
March
2023
and
replaced
by
Swider.

That
blank
check
company
last
month
completed
a

merger
to
take


Trump
Media
&
Technology
Group
Corp.
public,
allowing
it
to
trade
on
the
Nasdaq
Stock
Market.
The
company,
which
owns
the
Trump-centric
social
media
app
Truth
Social
and
trades
under
the
ticker
DJT,
soared
in
its
stock
market
debut
but
those
gains
have
since
erased.

On
Wednesday
alone,
the
share
price
fell
nearly
9%.
Since
April
1,
the
stock
has
lost
almost
45%
of
its
value.

The
Florida
lawsuit
is
just
one
in
a
series
of
messy
and
dramatic
legal
disputes
that
have
come
to
define
Trump
Media’s
rocky
road
to
an
IPO,
and
its
equally
turbulent
first
weeks
as
a
public
company.

DWAC
in
July
settled

fraud
charges
with
the
Securities
and
Exchange
Commission,
though
the
agency
found
the
SPAC
had
submitted “materially
false
and
misleading”
filings.

Trump
Media
in
late
March
sued
its
co-founders
over
alleged

mismanagement
of
the
merger,
and
is
seeking
to
bar
them
from
owning
the
company’s
stock.

Those
co-founders
have

sued
Trump
Media in
Delaware
Chancery
Court
over
their
stake
in
the
company.

Critics,
meanwhile,
have
labeled
the
company
a

meme
stock
and
a “scam.”
They
point
to
the
company’s
reported
net
loss
of
$58.2
million
on
revenue
of
just
$4.1
million
in
2023.

Trump
Media
did
not
immediately
respond
to
CNBC’s
requests
for
comment
on
the
lawsuit.
Emails
sent
to
addresses
that
belonged
to
Swider
and
co-defendant
Alexander
Cano,
DWAC’s
former
president,
did
not
immediately
receive
responses.

In
an
interview
with

Wired,
which
first
reported
the
lawsuit
earlier
Wednesday,
Swider
denied
all
of
the
allegations
against
him.

“I
just
think
he’s
never
let
go
[of]
the
fact
that
I
replaced
him,”
Swider
told
the
outlet. “I
don’t
know
why
it
offends
him
so
bad.”

The
Florida
lawsuit,
which
was
filed
shortly
before
the
late
March
merger,
presents
Orlando
as
successful
in
his
efforts
to
bring
DWAC
into
a
merger
agreement
with
Trump
Media.

It
alleges
that
Swider
misled
DWAC’s
directors
and
business
partners
by
publishing “false
and
misleading
representations
of
what
was
occurring”
at
the
company.

He
also
allegedly “offered
outsized
compensation
to
the
other
directors
he
enlisted
to
collude
with
him
in
exchange
for
supporting
his
coup
d’état.”

Swider
stood
to
massively
increase
his
compensation
through
his
accession
to
CEO
of
DWAC
—
but
he
also
wanted
to
take
control
of
ARC
II,
which
owned
about
19%
of
DWAC
prior
to
the
merger,
according
to
the
lawsuit.

Trump
Media
in
an
April
1
regulatory
filing
reported
that
ARC
II
owns
6.9%,
or
about
9.5
million
shares,
of
the
post-merger
company.

Information
about
ARC
II
was
held
in
an
account
on
an
electronic
file
storage
website
owned
by
Benessere,
the
suit
says.

To
access
the
account,
which “stores
the
lifeblood”
of
both
investment
firms,
Swider
allegedly
enlisted
Cano,
Orlando’s
former
assistant.
The
firms
accuse
Swider
of
promising
to
make
Cano
the
president
of
DWAC
in
exchange
for
access
to
the
account.

Cano
agreed,
and
Swider “made
good
on
his
promise,”
while
also
providing
Cano
with
a
convertible
note
worth
165,000
shares
of
DWAC’s
stock
—
an
award
valued
at
more
than
$6
million
at
the
time,
the
suit
alleges.

Swider
said
in
the
interview
with
Wired
that
Orlando
voted
for
Cano’s
award,
adding
that
he
never
hired
Cano
as
his
assistant,
as
the
suit
alleges.

The
lawsuit
says
that
Cano
since
February
2023
repeatedly
accessed
the
storage
account
and “immediately”
provided
the
information
within
it
to
Swider.

Swider
then
used
it
to
email “false
and
defamatory
claims”
about
Orlando
to
ARC
II’s
members,
according
to
the
suit.

In
a
March
5
email
—
included
in
the
lawsuit
as “Exhibit
A”
—
Swider
accused
Orlando
of “failure
to
maintain
a
fiduciary
responsibility”
to
ARC
II,
among
a
litany
of
other
claims.

“Patrick
has
threatened
me
with
pending
litigation
for
speaking
out
to
fellow
membership
holders
so
I
want
to
be
clear
about
this.
I
am
not
disparaging
Patrick,”
Swider
wrote
in
the
email.

“I
am
sure
he
is
an
amazing
Human
being,
Honest.
hard
working.
Looking
out
for
your
best
interest.
He
is
good
looking.
He
is
cool.
I
like
him.
Nothing
in
this
email
is
meant
to
be
defamatory.
He
has
been
great
as
a
leader.
Patrick-
you
are
Awesome!!”

Orlando
later
discovered
the
email
because
Swider “failed
to
remove
Orlando’s
wife
from
the
mailing
list,”
according
to
the
lawsuit.