An investor sued Lottery.com over concerns that backers of its blank-check merger with a SPAC deliberately pushed a disastrous deal because it gave them a windfall at the expense of public shareholders, Bloomberg reports.
The lawsuit seeks internal files from Lottery.com to investigate claims that sponsors of the SPAC it merged with, Trident Acquisition, kept investors in the dark about “foundational” flaws in the lotto company’s business model. The company’s stock has allegedly crashed 95% since the deal closed.
The case is the latest in a wave of litigation prompted by SPAC mergers.
Trident shareholders approved the deal in October 2021, when Lottery.com was expected to receive over $63 million in gross proceeds. Trident stockholders were so enthused for the deal that less than 1% of the SPAC’s shares were redeemed ahead of the merger vote. Read more.