Class Action Lawsuits Filed Against Trident Acquisitions Founders and Financial Advisor

The architects of an ill-fated 2021 merger between owner AutoLotto and the special purpose acquisitions company Trident Acquisitions are facing class action lawsuits in the Chancery Court of Delaware. The deal made a publicly-traded entity, but share values for the lottery courier service began to plummet almost immediately. Revelations of financial deception, executive resignations, and shareholder lawsuits followed.

The plaintiffs in the three cases are Tim Weishipl, Jared Polisher and Edward Knolls. Weishipl filed a class action complaint “on behalf of himself and similarly situated current and former stockholders” in April 2023. Polisher and Knolls followed suit in May. If the cases advance, it seems likely that they would be consolidated.

Lottery couriers have exploded in popularity in the US. Many states that have failed to legalize direct online lottery sales have accepted these services as an alternative. Despite the spectacular collapse of, other couriers like Jackpocket are doing well.

Shareholders aren’t the only ones who were hurt by’s failure. Another recent lawsuit against the company came from the former owners of its subsidiary TinBu. They allege they never received full payment for the acquisition.

That may be the reason for the new lawsuits, despite similar ones having been filed against itself last year. If the company is having difficulty making good on existing financial obligations, it may also be unable to pay any potential court judgment against it. That would make any victory against it a hollow one, whereas the individual defendants might be more lucrative targets.

Alleged Conflict of Interest

Weishpl’s complaint focuses on the idea that the defendants had created a conflict of interest surrounding Trident.

The founders of the SPAC had given themselves a stake in the company, for which they paid a nominal price of less than one cent per share. A SPAC, by definition, has no operations of its own and exists only to acquire another company and take it public.

What that means, per the complaint, is that the founders’ shares would be worthless if the SPAC failed to find an acquisition target within the allotted time. On the other hand, if such a deal closed, they would take on the value of whatever company Trident acquired.

Thus, the founders would benefit financially by closing on any deal. Conversely, as the board of directors, they had a legal duty to other shareholders to accept only a favorable deal. A bad deal — as the suit alleges to have been — would make money for the founders while causing a loss for other shareholders.

Trident’s board originally had 18 months to find a target and was looking at oil-and-gas companies in Eastern Europe. According to the complaint, the board asked for six extensions while changing its acquisitions strategy:

Ultimately, after failing to find an oil-and-gas target, Trident abandoned its focus on oil and gas and focused on just finding a merger partner — any merger partner — first shifting to technology companies and eventually settling for an obscure entity in the online gaming industry.

The suit claims that because of that conflict of interest, Trident intentionally misled investors about the “legally questionable” nature of AutoLotto’s business and assigned an “unjustifiable valuation” to the merger.

Meanwhile, AutoLottery, by the company’s own later admission, was distorting its financial position and failing to comply with state laws regarding the sale of lottery tickets. This is what led to the firing of president, treasurer, and CFO Ryan Dickinson in July 2022. Several other board members resigned not long after.

Suit Includes Financial Advisors as Well as Board Members

It’s not uncommon for investors to attempt to sue board members when deals like these go awry. What’s more unusual about Weishpl’s suit is the inclusion of the financial advisorChardan Capital Markets, as a defendant.

The key here is that the board also allegedly created a conflict of interest for Chardan by making its payment conditional on closing a deal.

The complaint states:

Chardan, as Trident’s financial advisor, aided and abetted these breaches of fiduciary duties due to its own financial incentive to get a deal done[…] with tens of millions of dollars in its compensation conditional on the Merger closing.

Weishpl also asserts that Chardan, through assisting with due diligence on the deal, should have been aware of the deceptions allegedly being carried out by Trident and AutoLotto.

About the Author

Alex Weldon

Alex Weldon

Alex Weldon is an online gambling industry analyst with nearly ten years of experience. He currently serves as Casino News Managing Editor for, part of the Catena Media Network. Other gambling news sites he has contributed to include PlayUSA and Online Poker Report, and his writing has been cited in The Atlantic.
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