This website uses cookies so that we can provide you with the best user experience possible. Cookie information is stored in your browser and performs functions such as recognising you when you return to our website and helping our team to understand which sections of the website you find most interesting and useful.
Business News Legal Live Business
SFX sued by co-founders
By Andy Malt | Published on Friday 7 February 2014
Highly acquisitive EDM events firm SFX Entertainment is being sued by three apparent co-founders, who claim they were “frozen out” of the company by CEO Robert Sillerman, reports Bloomberg.
Paolo Moreno, Lawrence Vavra and Gabriel Moreno claim that entertainment industry veteran Sillerman approached them in early 2012 to discuss his plans for an electronic music-focussed company. Having no experience in that side of the business, they say Sillerman used the three men’s expertise to identify and purchase seven of the eight companies listed as SFX’s “principal assets” in its IPO filing last year.
The men say that they owned shares in the original company which should have been worth over $100 million when the firm sold off a portion of its equity on the NASDAQ stock exchange last year, but that they were defrauded of these shares and left with nothing.
A lawsuit filed this week states: “Had they known that Sillerman’s true intentions were to use plaintiffs’ strategy, information, connections and access for his own gain, without granting plaintiffs any significant ownership interest in the venture, plaintiffs would not have entered into any agreement with Sillerman, and would not have undertaken to execute on the strategy for the benefit of SFX”.
A spokesperson for SFX told the Wall Street Journal that the claims are “baseless”.
