Nice Start! Trump’s TRUTH App May Violate Terms Of Open Source Code It’s Built On | Talking Points Memo

[occamscoin]

DWAC had 29.3 million shares to work with, which were valued at $10 apiece due to being backed by $293 million in cash. If they paid 10 million shares, worth $100 million for 11.4% of TMTG, then TMTG was acquired at a valuation of $875 million for the whole thing. The extra $825 mil earnout would, again, be the option to “earn” another 82.5 million shares of DWAC.

Again, no there there in that deal since TMTG has no revenue and no products and no assets, but not fraudulent, because nasdaq imposes no requirement that the “real” company a SPAC acquires actually do anything. Caveat emptor.

[arun]

Common sense ethics-wise this is a scam.
But legally is it? Is it sufficiently bad for an investigation and prosecution?

[txlawyer]

If you pay an artificially-inflated price to acquire a bullshit asset with Trump’s name on it and announce that artificially-inflated asset price as a valuation of the bullshit asset in order to pump and dump a bunch of shares, that’s securities fraud.

[occamscoin]

@txlawyer

If you pay an artificially-inflated price

Where’s the artificial and where’s the inflation? No one disputes that DWAC has $293 mil in cash. You want this to be fraud, and from a common sense viewpoint it is fraud, but I do not think it is securities fraud, nor any other kind of prosecutable fraud.

Lets also note that this deal is still subject to “regulatory and stockholders approval”, and we haven’t seen the paperwork (always read the footnotes!) to know the actual terms of the deal. This thing has traded everwhere from $69 to $157 today, and people are effectively buying it blind on the premise of a deal.

[txlawyer]

@occamscoin

Where’s the artificial and where’s the inflation?

There’s no asset that’s remotely viable at that purported valuation. They’ve simply taken a bunch of money, handed it over to Trump so they can make an announcement about how insanely valuable their new acquisition is, and offloaded a bunch of shares at the newly artificial price. May as well have announced that they have acquired Trump’s Dumps in a deal valued at eleventy billion dollars. Only the finest Dumps.

[occamscoin]

@txlawyer

There’s no asset that’s remotely viable at that purported valuation.

We’ll have to disagree there. The ability to deliver an audience of 30-50 million devoted gullible monetizeable morons has considerable value. One could even make an argument they underpaid. Some top pro athletes are getting 9 figure endorsement deals.

Now, I have zero confidence in the ability of any TFG led organization to build a viable social media site, nor in his commitment to such an effort once he’s got his cash out, but the premise is real.

[txlawyer]

Trump shut down his post-presidential blog in less than a month due to it being embarrassingly undertrafficked.

[occamscoin]

@txlawyer

due to it being embarrassingly undertrafficked.

Inappropriate platform. On other platforms he delivered in spades.

[txlawyer]

Mostly bots.

[occamscoin]

If it was just bots they wouldn’t have shut him down. There was sufficient real engagement for him to be dangerous.

[decay500]

Thanks for the back-and-forth. Much more enlightening and informative than anything I’ve been looking at on TV or online.
Time for a Tx/Coin show !!!

[zenicetus]

@txlawyer

Trump shut down his post-presidential blog in less than a month due to it being embarrassingly undertrafficked.

Stepping gingerly into this because I don’t know anything about securities fraud… but the site that Parscale put up earlier was nothing like what is being promised for this new venture. Not even remotely, because it wasn’t built around “engagement.”

This new project is supposed to be the MAGA alternative to Twitter or FB, which could at least theoretically attract an audience where other conservative-focused social media platforms like Parler and Gettr have failed. They have failed because Trump isn’t participating on those platforms! The tease is that he would participate on this new one. That’s critical. There is an actual potential audience out there, which is the basis for a valuation.

[txlawyer]

@zenicetus

This new project is supposed to be the MAGA alternative to Twitter or FB, which could at least theoretically attract an audience where other conservative-focused social media platforms like Parler and Gettr have failed.

“Theoretically” monkeys might fly out of my butt. It’s not the standard for securities fraud.

[arun]

Mark Sumner, Daily Kos:

Donald Trump's new 'social media platform' isn't a Twitter rival. It's an...

TMTG isn’t a social media platform. It’s a scam. Trump doesn’t need another social media platform. He needs suckers willing to buy stock . And Trump has always been very, very good at locating suckers.

Not every SPAC is a scam. They really can be a means of quickly connecting investors to rising companies that aren’t yet at a stage that would allow them to get onto the exchange through more traditional means. But of the $82 billion raised through SPACS in 2020, a large amount is either super speculative investment or an outright scam. Which lead the Harvard Business Review to note last February that the SPAC bubble was looking very fragile. Once it became clear that this was a way to drub investors for ready cash, everyone wanted in.

Trump isn’t being innovative in his technology. He’s not even being innovative in his scam. In a lot of ways, he’s late to the SPAC party. But it’s way past time for the SEC to put some serious restrictions on these backdoor listing schemes and blank check companies.

[Anarchy_Bunker]

@txlawyer

“Theoretically” monkeys might fly out of my butt. It’s not the standard for securities fraud.

Explain to me which investments are not forward looking, because apparently that is your argument for fraud.

[old_guru]

Shut down before he gets the first pack of lies assembled. Love it!

[txlawyer]

The alleged valuation of the company is not a forward-looking statement. Even if it was a forward-looking statement, the securities fraudsters here could not take advantage of that safe harbor because they did not make any of the required disclaimers about forward-looking statements. It probably also doesn’t apply because the SPAC seems likely to qualify as a “blank check company.”

[Anarchy_Bunker]

@txlawyer

The alleged valuation of the company is not a forward-looking statement.

I didn’t say that. I asked a question. And the point is moot since you’ve recognized the legal flaws in your original argument which I was going get to next.

[txlawyer]

Ah, foiled by my own legal flaws. Curses!

[Quel]

[tfg]'s new social media platform, TRUTH Social, has been given 30 days to comply with the software’s terms of license before its access is terminated. If it fails to comply, the platform may face legal action or have to rebuild from scratch.

Trump Media and Technology Group, a new company started by the former president, announced Wednesday it would soon launch TRUTH Social, a new platform aiming to “stand up to the tyranny of Big Tech.” The site is being built with the open-source software Mastodon.

The Software Freedom Conservancy, a nonprofit organization that provides support and legal services for open-source software, said Friday that while anyone can use Mastodon’s code for free to build online platforms, they must comply with its license that requires offering the user’s own source code, which TRUTH Social has not done.

TRUTH Social refers to its platform and software code as “proprietary.” Unless it changes its approach and opens up its code for users to view within 30 days, the platform can no longer use the Mastodon software it has been built upon.