The lawsuit, filed in state Supreme Court in Manhattan, stated that IAC and its subsidiary Match Group Inc deliberately prevented the plaintiffs from cashing in stock options they could exercise and sell to IAC. They are seeking damages of not less than $2 billion.
Orin Snyder, a lawyer for the plaintiffs, stated ‘the defendants made contractual promises to recruit and retain the men and women who built Tinder. The evidence is overwhelming that when it came time to pay the Tinder employees what they rightfully earned, the defendants lied, bullied, and violated their contractual duties, stealing billions of dollars.’ IAC and Match Group responded that the allegations ‘are meritless and we intend to vigorously defend against them.’ The plaintiffs. which include Tinder founders Sean Rad, Justin Mateen and Jonathan Badeen, were given stock options in Tinder as part of their compensation in 2014. Because Tinder is a private company, they were not able to exercise their options and then sell stock on the open market. Instead, they were allowed to exercise their options and sell only to IAC and Match on four specific dates, in 2017, 2018, 2020 and 2021, on which the stock options would be independently valued, according to the lawsuit. The plaintiffs claimed that IAC and Match engaged in a ‘disinformation campaign’ to obtain a ‘bogus’ $3 billion valuation for the 2017 date. The suit states when IAC and Match merged Tinder into Match, without the consent of Tinder’s board of directors, the canceled the future dates for exercising options.
Additionally, the suit accuses Tinder's former CEO, Greg Blatt, described in the suit as ‘a longtime lackey of IAC's controlling shareholder Barry Diller’ with ‘a well-earned reputation as a notorious bully with a volcanic temper and a habit of threatening to fire employees who contradicted him, of groping and sexually harassing Tinder’s vice president of marketing and communications, Rosette Pambakian, who is one of the plaintiffs, during the company’s 2016 holiday party. The plaintiffs claim that Match and IAC not only knew about the alleged sexual harassment by Mr Blatt but covered it up because a credible investigation and a public firing would have ‘derailed’ their scheme and so they ‘whitewashed Blatt’s misconduct’ instead.