Tinder Founders, Executives Sue Parent Company For Withholding Stock Options

A group of prominent Tinder employees is suing the company’s parent company. A lawsuit filed in New York State Supreme Court listed 10 plaintiffs, comprised of either current or former executives at the massively popular dating app. The plaintiffs, which includes founder and former CEO Sean Rad, have accused IAC and Match Group of using misleading projections and other manipulative tactics to keep them from receiving payments they were entitled to in their contracts, according to their press release.

The current and former Tinder employees seek at least $2 billion in damages for what they called “deception, bullying and outright lies.” The complaint said that IAC and its Match Group subsidiary allegedly used financial maneuvers to strip them of stock options.

IAC and Match’s alleged tactics included issuing fake valuations for Tinder that did not accurately reflect growing revenue. The listed employees, which includes co-founder and current strategy chief Jonathan Badeen and marketing lead Joshua Metz, were reportedly entitled to valuations in 2017, 2018, 2020 and 2021, at which points they could sell their stocks to IAC and Match.

However, the lawsuit accused IAC and Match of issuing that faulty valuation and essentially turning Tinder into a holding name and little else in July 2017. This was allegedly to “extinguish” the plaintiffs’ stock options. The press release used Tinder’s recent impressive earnings report as evidence that its parent company manipulated its projections.

The other major wrinkle to the lawsuit is a claim of sexual harassment by former Match chairman and CEO Greg Blatt. According to the suit, Blatt allegedly sexually harassed Tinder VP of marketing and communications Rosette Pambakian at a holiday party in 2016. Pambakian is one of the plaintiffs in the suit.

The parent company may have covered up Blatt’s behavior because exposure could have jeopardized the plan to withhold money from the plaintiffs, which Blatt allegedly spearheaded. He left the company at the beginning of 2018 and was replaced by Mandy Ginsberg.

“We were always concerned about IAC’s reputation for ignoring their contractual commitments and acting like the rules don’t apply to them,” Rad said in a statement included in the press release. “But we never imagined the lengths they would go to cheat all the people who built Tinder.”