Match has reached a $441 million settlement in its lawsuit with the Tinder founders and executives. The suit, filed in 2018, charged that IAC and its former subsidiary Match Group had manipulated financial data to fabricate a phony “starting price” for the dating app when it was combined with IAC in 2017.
The plaintiffs also claimed they were illegally prevented from holding stock options on their Tinder holdings. At the time of filing, the suit demanded “billions of dollars” in compensation.
Tinder’s co-founders, Sean Rad, Justin Mateen, and Jonathan Badeen, as well as James Kim, the vice president of finance, and Rosette Pambakian, the vice president of marketing and communications were among the plaintiffs.
Naturally, Match had called the claims “baseless,” noting that its worth was determined through a legally-mandated valuation process that included two separate global banks. It had sworn to vigorously defend itself in court.
As the litigation proceeded, some of the plaintiffs’ claims were dismissed, including those alleging that the merger was unlawful and that product releases were unlawfully delayed.
Match Group has reached a settlement with the plaintiffs, according to an SEC filing published today. The firm has agreed to pay the claimants $441 million in return for their agreement not to bring any claims on trial or in arbitration related to its 2017 Tinder valuation.
Match Group will pay the sum out of current cash. According to Truist analyst Youssef Squali, Match Group had about $510 million in cash and cash equivalents on hand at the end of the third quarter.
The parties then released a media statement in which they stated: “The parties are pleased to announce that they have settled the valuation lawsuit presently on trial in New York Supreme Court and the related valuation arbitration.”
Although Match was not fined $9 billion as the plaintiffs had requested, $441 million is not a sum to sneeze at — especially for a lawsuit that Match had previously dismissed as “meritless.” Going to court, on the other hand, can be costly for an organization; Squali mentioned this suit has been hanging over Match’s head for years costing tens of millions of dollars.
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