By: Ellen Cans
On Monday, billionaire Barry Diller stood trial in court to defend his media conglomerates from a lawsuit, which claims they cheated the founders of Tinder out of $2 billion.
As reported by the NY Post, the online dating networking app’s co-founder and former CEO Sean Rad is suing Diller’s two companies —IAC and Match Group. He alleges that they gave outside investment banks false “doom-and-gloom” financial forecasts in 2017, during crucial valuation sessions. Rad and the other plaintiff say the banks subsequently gave Tinder a valuation of just $3 billion, instead of roughly $13.2 billion, drastically reducing the payouts co-founders and other key employees received.
When questioned by Rad’s attorneys, Diller adamantly denied ordering underlings to lie to banks, and called the notion “absurd.” “It would be wrong,” said Diller. During questioning, Diller often seemed exasperated, saying “Oh my god” twice and dismissing at least one question as “ridiculous.” The 79-year-old tycoon, who reportedly has an estimated net worth of $5.28 billion, is Chairman of IAC and Expedia Group and founder of Fox Broadcasting Company and USA Broadcasting. He is married to fashion icon Diane von Fürstenberg, and together they have pledged to donate $113 million toward Little Island, a NYC public park and performance space on a reconstructed pier on the Hudson River.
Last week, Rad had taken the stand in court to accuse Diller’s company of making him net just $400 million from Tinder, instead of the more than $1 billion he felt he should have made. Rad, who founded Tinder in 2012 while working for a Diller-backed startup named Hatch Labs, said the valuation incident left him with emotional scars. “I had PTSD, been going to therapy, I’d been working on myself,” Rad said on Friday.
As per the Post, another early Tinder employee and a plaintiff in the suit, Alexa Mateen, also testified on Monday. She said, Diller’s companies “cheated us out of what was supposed to be ours, corrupted the valuation.” Attorneys for IAC and Match sought to cast doubt on Mateen’s testimony, with a report that Rad had personally wired her $8.8 million in late 2017, less than a year before they filed the suit. Mateen acknowledged the previously unreported payment, but claimed it “had nothing to do with this lawsuit.”
The trial is slated to wrap up sometime later this month or in December. Alternatively, the parties might opt to settle the case for somewhere between $300 million to $700 million, as per Susquehanna litigation analyst Thomas Claps.
