A Momentus investor sued backers of its blank-check merger with a shell company, claiming they deliberately engineered a catastrophic transaction because the deal's structure gave insiders a windfall, bloomberg reports.
The lawsuit targets Stable Road Capital affiliates that sponsored the 2021 combination between Stable Road Acquisition and Momentus, a space infrastructure business founded by “a Russian national with opaque ties to Russian military and intelligence agencies.” Several Defense Department ex-officials who served under former President Donald Trump — investigated for years over his alleged ties to Russia — joined Momentus after leaving the government.
The company, along with certain top executives, in 2021 paid $8 million to settle Securities and Exchange Commission fraud charges stemming from the merger.
A Momentus investor in June last year sued the space infrastructure company in Delaware, citing concerns that SPAC sponsors pushed a flawed transaction because it was structured to give them a windfall whether the deal worked out or not. Read more.
Source: Momentus SPAC Backers Accused of Hiding ‘Disastrous Deal's Flaws'