Barry Diller’s Match Group paying $441M to settle Tinder suit
Barry Diller’s Match Group plans to pay out a whopping $441 million over claims that it cheated the founders of Tinder out of billions of dollars, the company said early Wednesday.
The payment comes as jurors in a dramatic Manhattan trial were set to deliver a verdict in a suit brought by Sean Rad and other Tinder co-founders who were seeking as much as $2 billion. The weeks-long trial saw heated testimony from Rad, Diller, former Match and Tinder CEO Greg Blatt and a host of other witnesses and experts over claims that Diller’s company rigged a key valuation process.
Rad claims that Tinder was unfairly valued at $3 billion because Diller allies shared “doom-and-gloom” numbers with outside investment banks — and that the hookup app should’ve actually been worth at least $13.2 billion.
The payout announced Wednesday will settle both Rad’s New York State Supreme Court suit and several other claims in arbitration over the contested valuation, which occurred in 2017, according to a brief Match Group filing with the Securities and Exchange Commission. Money for the settlement will come out of the company’s cash on hand, Match said.
Thomas Claps, a Susquehanna litigation analyst who closely watched the case, said a settlement makes sense for both parties since juries can be highly unpredictable.
“It became clear that Match had a lot of problems that they had to confront in terms of repeated evidence of potential corruption and potential undue influence over the entire valuation,” Claps told The Post. “I think they decided to cut their losses because they could’ve been facing a much higher reward of up to $2 billion.”
As for Rad and the other Tinder co-founders, Claps predicts a party.
“By securing a settlement on their own terms for nearly half a billion dollars, I think they’re likely very pleased,” Claps said.
Match Group shares were up 3.2 percent in pre-market trading but have fallen about 15 percent over the past month.
“Match investors have been very concerned about this case and looking at the stock price during the course of the trial — it was clear that investors were not comfortable with how this could play out,” Claps said. “Now that the trial is over and this issue is in the rearview mirror, it’s not surprising that the stock may be modestly up today.”
Match spokeswoman Justine Sacco and Rad spokeswoman Brandy Bergman did not immediately comment.
“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,” Match said in the SEC filing.