Asset Manager Claims He Was Frozen Out of Trump Media SPAC

(Bloomberg) -- An asset manager who claims he was “instrumental” in landing former President Donald Trump’s planned media company for the special-purpose acquisition company Digital World Acquisition Corp. claims he was removed as a potential director and cheated out of shares.

Bluestone Capital Management’s Brian Shevland said Digital World Chief Executive Officer Patrick Orlando was behind an August regulatory filing in which Shevland’s name was quietly removed from the SPAC’s board, according to a lawsuit filed in a Miami federal court on Tuesday. 

Keeping the asset manager off the regulatory filing was the “final, brazen act of fraud” that “cemented the freeze-out of Shevland” from Digital World, he said. Shevland claims Orlando also excluded him from other SPACs in violation of their agreement.

Shevland asked a judge to find that Orlando breached their contract and to award unspecified money damages.

Orlando didn’t immediately respond to a message seeking comment on the suit.

Digital World disclosed this month that it received information requests from the U.S. Securities and Exchange Commission, seeking records tied to meetings involving its board of directors, its policies and procedures related to trading and the identities of certain investors.

Trump, who was banned from Twitter and Facebook as a result of the Jan. 6 insurrection at the U.S. Capitol, announced in October the plan to merge his planned Trump Media & Technology Group with a SPAC. 

Senator Elizabeth Warren has criticized the SPAC deal, saying she is concerned that Orlando may have improperly held discussions with Trump months ago without disclosing that to potential investors. SPACs, which are organized to raise money to invest in existing companies, have become increasingly popular in recent years.

The case is Shevland v. Orlando, 21-cv-24324, U.s. District Court, Southern District of Florida (Miami)

©2021 Bloomberg L.P.