Dec 1 (Reuters) - Match Group Inc (MTCH.O) said on Wednesday it would pay Tinder founders $441 million to settle a case in which the dating app's executives claimed the parent company lowballed the app's value to avoid paying billions of dollars.
While the settlement didn’t result in the billions in damages that the plaintiffs had originally wanted, $441 million is not exactly a small number — especially for a case that Match had repeatedly dismissed as “meritless.” However, going to trial can also be expensive for a company and this suit has been hanging over Match’s head for years, costing tens of millions of dollars, Squali noted.
In 2014, as part of their compensation, the plaintiffs were given stock options in Tinder. However, as Tinder is a private company, the plaintiffs could not exercise their options and sell the shares in the open market.
The plaintiffs were given a second alternative of selling only to the IAC and Match on certain dates on which the stock options can easily be studied upon later.
As the case proceeded, the court dismissed some of the plaintiffs’ claims, like those that alleged the merger was not lawful, that product releases were wrongfully delayed, and those requesting damages for wrongful contract beyond breach of contract.
Tinder is one of Match Group's fastest growing brands, which benefited a lot from the pandemic as many clients used the application.
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