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Tinder co-founder’s lawsuit against Tinder parent company moves closer to a trial

Tinder co-founder’s lawsuit against Tinder parent company moves closer to a trial


The judge rejects IAC / Match Group’s motion to dismiss claims

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Illustration by Alex Castro / The Verge

Tinder co-founder Sean Rad’s $2 billion lawsuit against the dating app’s parent company is one step closer to trial. In an order last night, New York Supreme Court judge Saliann Scarpulla rejected IAC’s motion to dismiss Rad’s case, allowing Rad and his co-plaintiffs to pursue their allegations that Match Group and IAC purposely undervalued Tinder in an effort to avoid paying out billions of dollars in stock options to the original dating app team.

In a statement to The Verge, the plaintiffs’ lawyer Orin Snyder said: “We are pleased by the Court’s ruling denying IAC/Match’s motion to dismiss and paving the way for this case to go to trial. IAC/Match robbed the Tinder founders and early employees and will now be held accountable by a jury for their multi-billion dollar scheme.”

Most of IAC’s arguments in the motion to dismiss focused on procedure and timing of the case, not the substance of Rad’s claims. IAC argued that too much time had passed between this lawsuit and the initial Tinder valuation, which Rad and his co-plaintiffs argue was a fraud. The judge rejected the defendants’ claim, and further allowed four plaintiffs — Rad, Paul Cafardo, Gareth Johnson, and Ryan Ogle — to pursue punitive damages and benefits from promised future valuation events that never occurred because Tinder was merged into Match Group. Former Head of US Expansion Alexa Mateen and co-founder Justin Mateen will not be able to benefit off those future valuations because they left the company prior to the May valuation that put the dating app’s worth at $3 billion.

Judge Scarpulla gave IAC 30 days to file an answer to Rad’s complaint, which would move the case closer to trial, but Match has vowed to appeal. In a statement to The Verge, Match Group spokeswoman Justine Sacco said, “This baseless lawsuit has no more merit today than it did a year ago when it was filed. We’re pleased the court dismissed some of these bogus claims and look forward to defeating the rest of them, both on appeal and in the trial court.”

It’s still unclear whether former plaintiffs like Rosette Pambakian, who alleged sexual misconduct on the part of IAC executives, will be able to participate in the lawsuit. She and three other plaintiffs withdrew from the lawsuit over an arbitration clause, but “without prejudice,” which means that they could theoretically rejoin.