Tuesday, August 30, 2022
Dog Bites Man: Trump Entity Is (Allegedly) Breaching Its Contractual Obligations
According to media reports, including this one from Drew Harwell in The Washington Post, FPOTUS Donald Trump's Twitter clone, Truth Social, is in financial difficulties. An SEC S-1 filing from Digital World Acquisition Corp., the company that is supposed to take the Trump Media and Technology Group (TMTG) public, contains all sorts of statements casting doubt on the viability of the enterprise. Mind you, SEC filings are supposed to protect against claims by investors that they were mislead as to the company's prospects for success. Pessimism is common. When I was in private practice helping to deal with the fallout of the post 2000 .com bust, every SEC filing I read about a technology company made the following points:
- We are bleeding money;
- We have never made money;
- We don't know when we ever will make money; and
- We have invested heavily in companies just like us that are bleeding money, have never made money, and don't know whether they will ever make money.
My job was to explain why my clients nonetheless advised their clients to invest in such companies.
Perhaps more alarming is the report that TMTG has stopped paying its bills. According to WaPo, TMTG stopped paying its web-hosting service, RightForge, in March and is now in arrears to the tune of over $1 million. As WaPo also notes, the man behind TMTG has a long history of not paying his bills. Not to mention the fraudulent businesses. Not to mention the fraudulent charitable organizations. More alarming still, an SEC investigation into the planned transaction involving TMTG and Digital World has placed the entire deal on hold.
The FPOTUS has been in the news of late. Another dog bites man story. Despite the FPOTUS having posted (that is "truthed") on his site "WE GAVE THEM MUCH," he has also claimed that: (1) the FBI planted incriminating and classified documents; (2) he had declassified the documents; (3) he was entitled to keep the documents, and (4) the documents are subject to executive and/or attorney-client privilege. All of these shenanigans have somehow not improved traffic on Truth Social, which now is down from a peak of 1.5 million to about 300,000 views per day.
Our goal on this blog is to overtake Truth Social for page views. Now that would be a man bites dog story.