In a federal civil lawsuit lodged in South Florida last month, investment firms, helmed by the former CEO of the SPAC that merged with Donald Trump's media company, claim that their files were hacked and stolen by a current member of the media company's board of directors.
The lawsuit accuses board member Eric Swider of orchestrating a coup in early 2023 to replace Patrick Orlando as CEO of the special purpose acquisition company, Digital World Acquisition Corp.
As part of the alleged attempted ouster, Swider and others purportedly obtained unauthorized access to the firms' computer systems and subsequently utilized the pilfered information to launch an assault on Orlando, as stated in the lawsuit filed by Benessere Investment Group and ARC Global Investments II.
Orlando was dismissed from Digital World in March 2023 and substituted by Swider.
The Florida lawsuit, filed shortly before the late March merger between DWAC and Trump Media, portrays Orlando as instrumental in securing the merger agreement.
The lawsuit contends that Swider misled DWAC's directors and business associates by disseminating “false and misleading representations” regarding the company's activities. Additionally, Swider purportedly provided “excessive compensation” to other directors recruited to collaborate with him in supporting his coup attempt.
According to the lawsuit, Swider stood to substantially boost his compensation by assuming the role of CEO of DWAC. However, he also aimed to gain control of ARC II, which held approximately 19% of DWAC before the merger. Trump Media disclosed in an April 1 regulatory filing that ARC II now owns 6.9%, equivalent to approximately 9.5 million shares, of the merged company.
The lawsuit alleges that information pertaining to ARC II was stored in an account on an electronic file storage platform owned by Benessere.
To gain access to the account, which purportedly holds vital information for both investment firms, Swider allegedly recruited Cano, who previously worked as Orlando's assistant. The firms allege that Swider offered to appoint Cano as the president of DWAC in exchange for access to the account.
Cano agreed to the arrangement, and Swider allegedly followed through on his promise. Additionally, Swider reportedly granted Cano a convertible note, entitling Cano to 165,000 shares of DWAC's stock—an award valued at over $6 million at the time, according to the lawsuit.
The lawsuit alleges that since February 2023, Cano has repeatedly accessed the storage account and promptly furnished its contents to Swider. Subsequently, Swider purportedly utilized this information to disseminate “false and defamatory allegations” about Orlando to members of ARC II via email, as stated in the suit.
Read the lawsuit here.
