Trump's Deal May Have Skirted Securities Laws

[LetMyPeopleVote]

16. I have helped out on some securities cases and know a good number of plaintiff firms

I have a feeling that there will be some litigation pending before this merger is closed

A couple major investors are already bailing and there is no PIPE in place to protect against excessive redemptions.

One major investor has bailed on this stunt https://www.nytimes.com/2021/10/22/business/dealbook/boaz-weinstein-trump-spac.html

News that Donald Trump was bankrolling a new media venture through a SPAC deal sent shares in the blank-check fund soaring some 350 percent. Much of that probably came from individual fans of the former president plowing into the vehicle, Digital World Acquisition. But at least one of the SPAC’s backers, a major hedge fund, pulled out over the Trump connection, and the question now is whether others will follow suit — or chase potential profit.

The hedge fund mogul Boaz Weinstein wanted out once news of the Trump deal emerged. He placed a sell order on all of the unrestricted shares in Digital World that his firm, Saba Capital, owned yesterday morning, though Saba still owns some restricted stock that it can’t sell for six months.

Saba sold its holdings in the first hours of trading, making a small profit — but before Digital World’s shares shot up, missing out on a huge gain. Weinstein said in a statement: “I knew that for Saba the right thing was to sell our entire stake of unrestricted shares, which we have now done.Many investors are grappling with hard questions about how to incorporate their values into their work. For us, this was not a close call.”