Vous êtes sur la page 1sur 8


Event Driven/Special Situations


IAC/MTCH: Multibillion-Dollar Tinder Lawsuit

Coming to a Head Analytics�Team
MTCH -- Neutral rating by SFG Internet analyst Shyam Patil


• Tinder’s�Founders�Seek�~$1.3B-$3.5B+�From�IAC/MTCH�Over�“Corrupt”�Valuation�Process: In August 2018, IAC and MTCH were sued

by Tinder co-founder Sean Rad/other early employees claiming that IAC/MTCH fraudulently undervalued their Tinder stock options in
2017 by at least $2B (we've estimated base trial damages at ~$1.3B-$3.5B). The Complaint alleges a variety of issues, including: in late
2016, IAC/MTCH took control of Tinder through certain management changes (e.g., removing Sean Rad from his Tinder CEO seat and
inserting MTCH's Greg Blatt); with IAC/MTCH in control, Defendants then manufactured, suppressed, and lied about Tinder’s financials
during a private valuation process, leading to a low-ball, $3B Tinder valuation, which resulted in a significant devaluation of Plaintiffs’ stock
options; and immediately following that “sham” valuation, Defendants used a surprise merger of Tinder into MTCH to terminate Plaintiffs’
Tinder stock option agreements, convert the Tinder stock options into less valuable MTCH options, and cancel the future scheduled
valuations. Plaintiffs allege that these improper maneuvers deprived them of profiting from Tinder’s future growth. IAC/MTCH dispute
these allegations, calling the case a “sour grapes” lawsuit filed by disgruntled former employees who are upset that they cashed out their
options too soon, given Tinder’s enormous success following their departures. As we head into year-end, the litigation is starting to pick up
steam. We expect Plaintiffs to push for a trial date in New York state court in 1H2021.

• Investors�Should�Be�Paying�Closer�Attention�to�the�Tinder�Litigation�in�Light�of�Recent�Developments:
• The�Recent�IAC�Separation�May�Shift�Tinder�Legal Liabilities Onto�MTCH: On June 30, 2020, IAC and MTCH completed the
separation of MTCH from IAC. New IAC has an ~$10.8B market cap and ~$2.9B in cash, while new MTCH has a ~$28.9B market cap
but only ~$129M in cash and ~$3.5B in debt. Separately, IAC/MTCH are defending themselves against a derivative/shareholder class
action lawsuit over the separation, claiming, among other things, that the separation of IAC from MTCH “is opportunistically timed
and allows IAC to escape potentially billions of dollars in [legal] liability” by requiring MTCH to indemnify IAC for all legal liabilities of
MTCH, including Tinder. Given that Plaintiffs are seeking billions of dollars in damages in this Tinder lawsuit, MTCH shareholders will
want to remain focused on this litigation, as we expect increased activity and a push by Plaintiffs for trial in 1H2021.

• MTCH�Warns�of�Increased�Litigation�Expenses: On its August 5, 2020 earnings call, MTCH stated that legal expenses remain a
headwind for the company, and while they were hoping to see them reduced next year, COVID-related court delays could cause
increased future legal expenditures. Given that the Tinder litigation is the most significant lawsuit facing the company, it will be the
primary driver creating MTCH’s legal headwinds and expenditures into 2021.

• Potential�“Smoking�Gun”�Trial�Evidence: Plaintiffs recently unveiled several pieces of evidence in court filings that appear to support
certain of Plaintiffs’ claims that IAC/MTCH orchestrated a corrupt Tinder valuation process in 2017. This evidence will continue to be
used by Plaintiffs to exert pressure over IAC/MTCH in the litigation (see Section III below).

• IAC/MTCH's�Near-Term�Request�to�Postpone�the�Litigation: Four of the original 10 Plaintiffs in this case dismissed their court claims
early on because they are subject to mandatory arbitration (these four Plaintiffs initiated arbitration in California over these same issues
in July 2020). On August 14, 2020, IAC/MTCH filed a request to stay/postpone any trial in the New York state court case while the
California arbitration plays out (asserting that the separate arbitration decision may narrow and potentially eliminate any New York

trial). A decision on this stay/postponement issue could come in the next few weeks. If IAC/MTCH succeed in their stay/postponement
request, it could push back their trial risk well into 2021 and provide them with increased settlement leverage.

• SFG�Prediction: We believe the Tinder litigation will present increased headline risk as we approach year-end, and Plaintiffs will make a
hard push to get a 1H2021 trial date. Based on the information presented by the parties to date, we don’t believe that IAC/MTCH will be
able to escape without incurring some liability/financial exposure. Given that the case involves allegations of corporate improprieties and
sham valuations, we expect IAC and MTCH to explore an early, pre-trial settlement in order to avoid the uncertainty and increased risk of a
jury trial, where potential punitive damages could create a significant headline verdict. We believe the case will ultimately end in a pre-trial
settlement -- our initial base case settlement estimate is $300M-$700M.


• Section�I: Background of the Tinder Lawsuit

• Section�II: Potential Trial Damages

• Section�III: SFG Analysis

• Section�IV: Timeline and Upcoming Catalysts


• Who�Are�the�Plaintiffs? – Tinder�Co-Founders�and�Early�Employees: Tinder, a leading mobile dating app, was launched in 2012. The
Plaintiffs in this lawsuit are Tinder co-founders Sean Rad and Justin Mateen and other early Tinder employees/former executives: Paul
Cafardo, Gareth Johnson, Alexa Mateen, and Ryan Ogle (four other Plaintiffs dismissed their claims early on in the lawsuit because their
claims are subject to mandatory arbitration, which began in July 2020). Plaintiffs claim that IAC/MTCH took control of Tinder through
certain management changes and then manipulated Tinder’s financials during a private valuation process, resulting in a low-ball Tinder
valuation that significantly devalued Plaintiffs’ stock options.

• Who�Are�the�Defendants? – IAC�and�MTCH: IAC (InterActiveCorp) is a holding company that has a majority ownership of ANGI
Homeservices (ANGI) and operates other online businesses such as Vimeo, Dotdash, and Care.com (it formerly had a majority ownership
of MTCH). IAC’s controlling shareholder and Board Chairman is media mogul Barry Diller. MTCH is a provider of dating products through
portfolio companies that include Tinder, Match, PlentyOfFish, Meetic, and OkCupid. MTCH (which owns Tinder) was spun out of IAC in
2015 and fully separated from IAC on June 30, 2020.

• Plaintiffs’�Primary�Allegations – IAC/MTCH’s�Illicit�Scheme�Devalued�Plaintiffs’�Options�by�Billions�of�Dollars:
• Background: Tinder was developed in 2012 by Plaintiff Sean Rad and others who worked at Hatch Labs, a startup incubator. IAC fully
owned Hatch Labs/Tinder in 2014. In 2014, as a result of contract negotiations with Plaintiffs, IAC/MTCH awarded the Plaintiffs Tinder
stock options, which represented ~18.5% of Tinder’s value. The 2014 agreements provided for four specific dates on which the options
would be valued and could be exercised and sold (May 2017, November 2018, May 2020, and May 2021). Those dates are referred to as
“Scheduled Puts.” Under these agreements, the more valuable Tinder became, the more valuable the stock options would be for the
Plaintiffs (and more expensive for IAC/MTCH).

• IAC/MTCH�Undervalued�Tinder�to�Slash�Plaintiffs’�Options: According to Plaintiffs’ court filings, in 2015, IAC/MTCH assigned a $3B

valuation to Tinder. By January 2016, MTCH executives agreed it would be appropriate to value Tinder between $7.05B and $11.75B.
However, in 2016-2017, to avoid massive payouts to the Plaintiffs under the first “Scheduled Put” in May 2017, Plaintiffs allege that IAC/
MTCH engaged in misconduct designed to cause independent banks to significantly undervalue Tinder (the private valuation was
based on an average of valuations submitted by Barclays and Deutsche Bank, which relied on financial information provided by IAC/
MTCH). According to Plaintiffs, the misconduct at issue included inflating Tinder expenses and inventing “an alternate universe in which
Tinder was stagnating toward freefall,” delaying/concealing the impact of new products and features (e.g., Tinder Gold), and hiding/
lying about the existence of Tinder’s true financial projections. Because the valuation process took place in private, IAC/MTCH were
able to engage in this alleged misconduct outside of the public domain/market scrutiny. As a result of the alleged scheme, IAC/MTCH
convinced the banks to issue a low-ball $3B valuation on Tinder.

Susquehanna Financial Group, LLLP


• IAC/MTCH�Secretly�Merged�Tinder�Into�MTCH�Right�After�the�Sham�Valuation: Plaintiffs assert that on July 13, 2017 (the same

day IAC/MTCH completed the “sham” $3B valuation), IAC/MTCH merged Tinder into Match “secretly and without any notice” to
the Plaintiffs/Tinder optionholders. IAC/MTCH also eliminated Plaintiffs’ Tinder options agreements and future Scheduled Puts and
converted all Tinder options into less valuable MTCH options at the low-ball $3B valuation – eliminating Plaintiffs’ ability to benefit from
Tinder’s future upside. Plaintiffs argue that the merger had no legitimate justification or real-world consequences.

• Plaintiffs�Allege�the�“Sham�Valuation”�Was�Achieved�by�a�Number�of�Maneuvers�From�IAC/MTCH,�Including:
• Replacing�Tinder�Execs/Plaintiffs�With�IAC/MTCH�Execs�Leading�Up�to�the�2017�Scheduled�Put: In December 2016, Sean Rad
(one of the Plaintiffs) was replaced as CEO of Tinder by MTCH’s Chairman and CEO Greg Blatt. IAC/MTCH also installed MTCH’s
Chief Financial Officer and Chief Strategy Officer into Tinder’s management. Plaintiffs allege that these management changes were
designed to give IAC/MTCH control over the Tinder valuation process and to prevent Plaintiffs from getting maximum value for their
Tinder options. Blatt retired just two weeks after the private valuation and merger was completed, suggesting that the sole intent in
inserting him as Tinder CEO was to help secure the “sham valuation.”

• Downplaying�Growth/Relying�on�False�Projections: Plaintiffs claim that IAC/MTCH deliberately hid internal Tinder financial
projections during the 2017 valuation process that “reflected significant, documented gains in revenue and profit, boosting Tinder’s
projected financial performance for 2018 by a large margin.” For the valuation, IAC/MTCH projected that Tinder revenue would grow
only 31% by the end of 2018 and its revenue growth rate would drop by more than 90% over the next five years. In addition, IAC/
MTCH projected during the valuation that Tinder revenue for 2018 would be $454M. In contrast, after the valuation was concluded,
on an August 2017 earnings call IAC/MTCH said that they expected Tinder to continue to be the major revenue driver for MTCH.
On its August 2018 earnings call, MTCH revealed that Tinder was on pace to exceed $800M in revenue for 2018 – nearly double the
revenues forecasted by IAC/MTCH during the valuation process.

• Downplaying�the�Impact�of�Tinder�Gold: In June 2017, Tinder began testing a new subscription service/tier called Tinder Gold that
allowed users to “pick and choose” users who previously “swiped right/liked” their profiles and bypass the process of reviewing
other profiles before arriving at matches. After testing in other countries, Tinder Gold launched in the U.S./worldwide in late
August 2017. Plaintiffs claim that during the 2017 Tinder valuation, IAC/MTCH knew Tinder Gold would be extremely valuable, yet
deliberately understated its revenue impact (and delayed the worldwide launch of Tinder Gold so that the value associated with the
service would not appear until after the valuation ended in July 2017). While IAC/MTCH privately claimed that Tinder Gold’s impact
on revenue would be trivial, Greg Blatt stated on an August 2, 2017 earnings call that they had “a great deal of confidence in” Tinder
Gold and that even during testing (which began before the Tinder valuation ended) Tinder Gold was “really unlocking a tremendous
amount of value.” A week after Tinder Gold’s August 2017 launch, MTCH’s market cap increased ~18% (by ~$1B). Similarly in a May
2018 earnings call, IAC/MTCH stated that Tinder Gold had “led to a surge in subscriber levels” and was the “most obvious driver”
for “dramatically higher” revenue per Tinder user.

• IAC/MTCH’s�Primary�Defenses – The�Valuation�Was�Proper�and�Plaintiffs�Are�Simply�Upset�They�Cashed�Out�Too�Soon:
• Plaintiffs’�Lawsuit�Is�a�Case�of�“Sour�Grapes” : IAC/MTCH argue that the $3B valuation in 2017 was the result of a rigorous,
contractually-defined valuation process that involved two independent global investment banks. According to a statement that IAC/
MTCH released shortly after the Complaint was filed, “Mr. Rad (who was dismissed from the company a year ago) and Mr. Mateen (who
has not been with the company in years) may not like the fact that Tinder has experienced enormous success following their respective
departures, but sour grapes alone do not a lawsuit make.”

• There�Was�Nothing�Improper�About�the�2017�Valuation�Process: IAC/MTCH assert there was nothing improper about replacing Sean
Rad with Greg Blatt as Tinder CEO -- �the truth is that Rad was replaced as CEO because he lacked the ability to manage a multibillion-
dollar company.� IAC/MTCH further claim that Sean Rad and his lawyers specifically negotiated to have two banks (approved by
Sean Rad) establish an independent valuation of Tinder . Plaintiff Rad also worked with Jefferies Financial Group to advocate for a
Tinder valuation as high as $12B. IAC/MTCH assert that Sean Rad and his advisers participated in the valuation process “from start to
finish, attending virtually every meeting with the banks over the course of eight weeks, and vigorously advocating for a higher Tinder
valuation.” Under that process, Barclays and Deutsche Bank, two leading investment banks, considered the views of Rad and IAC/
MTCH and determined that Tinder was worth $3B, the same amount that was used to value Plaintiffs’ Tinder options. Additionally,
while Plaintiffs complain about certain “secret” internal projections for Tinder, IAC/MTCH assert those projections were shared with
Plaintiff Rad in 2017 by James Kim (former Tinder director of finance and one of the original plaintiffs who dropped out/is now pursuing
arbitration). Thus, that information was part of what Rad presented to the banks during the valuation process and was taken into
consideration as part of the banks’ $3B valuation. Furthermore, the document Plaintiffs rely on for their assertion that MTCH valued
Susquehanna Financial Group, LLLP

Tinder between $7.05B and $11.75B comes from a �pitch deck� for potential Tinder employees -- which contains hypothetical growth
scenarios that were unrealistic at the time of the 2017 valuation. �Tellingly, Rad never even thought to provide the pitch deck to the
banks during the valuation process because he knew it did nothing to support his arguments.�

• No�One�Anticipated�the�Growth�Tinder�Was�Going�to�Have: While Plaintiffs complain about IAC/MTCH’s $454M Tinder revenue

projection for 2018, IAC/MTCH highlight that at the time of the 2017 valuation, Plaintiff Rad himself projected 2018 Tinder revenue
at only $503M. “No one at the time, including Rad, anticipated that Tinder would achieve 2018 revenue anywhere approaching
$800 million.” In addition, IAC/MTCH highlight that the 2018 revenue projections of $800M from August 2018 were developed more
than a year after the 2017 valuation. Furthermore, while Plaintiffs fault IAC/MTCH for projecting in 2017 that Tinder revenue growth
would “collapse by more than 90% over the next five years,” IAC/MTCH say that projections Sean Rad submitted to the banks during
the valuation process projected a similar decline in growth (a decline of 93% over five years). In short, IAC/MTCH argue that Tinder
outperformed everyone’s expectations, including Rad’s, but that does not mean the 2017 valuation was improper.

• No�One�Could�Have�Foreseen�Tinder�Gold’s�Positive�Revenue�Impact: While Plaintiffs complain that IAC/MTCH assigned almost no

impact to revenue from Tinder Gold during the valuation process, IAC/MTCH argue that Plaintiff Rad’s own projections for Tinder Gold
at that time were not significantly higher than the number ultimately used by Barclays.

• Rad�Wanted�Tinder�to�Be�Merged�Into�MTCH�to�Accelerate�Unvested�Options: IAC/MTCH argue that Plaintiff Rad was the one who
came up with the idea of merging Tinder into MTCH during the negotiations over Tinder’s value. At the time, the Tinder options were
illiquid because they could only be exercised every 18 months (“Scheduled Puts”), while MTCH options were liquid because MTCH
was a public company. Therefore, Rad’s counsel advocated for the merger and Rad did not raise any objections to the merger when it
happened, even though he knew it would prevent future valuations of Tinder options.

• Plaintiffs�Decided�to�Exercise�Their�Options�Following�the�$3B�Valuation�and�Earned�Over�$580M: IAC/MTCH assert that Plaintiffs’

decision to exercise their options and sell their MTCH shares shortly after the valuation is inconsistent with their current claim that
Tinder had been undervalued and was poised for explosive growth (e.g., Rad exercised his full set of options in August 2017). For
instance, Plaintiff Rad alone received over $377M – including $50M that resulted from previously unvested options that vested solely
because of the Tinder/MTCH merger. IAC/MTCH argue that Tinder outperformed everyone’s expectations after Plaintiffs exercised their
options and cashed out, and the valuation should not be revisited simply because Plaintiffs now regret their decision to cash out.

• IAC/MTCH�Argue�That�Sean�Rad�Actually�Owes�Them�~$400M: On January 15, 2019, seemingly in retaliation for his Tinder

lawsuit, IAC/MTCH sued Sean Rad for alleged employee misconduct/confidentiality breaches. For instance, they allege that he
misappropriated IAC/MTCH confidential information, destroyed a large number of documents in his work e-mail, and secretly recorded
his superiors and colleagues “without their knowledge or consent, all for his own selfish purposes.” Based on this alleged misconduct,
IAC/MTCH assert that Rad would have been fired long before his options were cashed out and that, as a result, Rad must repay at
least $400M in “equity compensation” that he received -- but would not have been entitled to absent these violations. However, on
June 1, 2020, the Judge issued a decision dismissing IAC/MTCH’s request for “claw-back” damages (i.e. to claw-back the $400M from
Sean Rad), leaving IAC/MTCH claims against Rad for “nominal damages or injunctive relief” along with minor damages for violations of
California’s invasion of privacy statute. IAC/MTCH have appealed this decision.

• IAC/MTCH�Are�Seeking�to�Delay�This�Trial�in�Favor�of�Arbitration: Four of the original 10 Plaintiffs in this case dismissed their lawsuits
because their claims are subject to mandatory arbitration. On July 12, 2020, these other Plaintiffs initiated arbitration proceedings in
California over the same options valuation claims. On August 14, 2020, IAC/MTCH filed a request to stay/postpone any trial in the
New York state court case while the other California arbitration plays out (asserting that the separate arbitration decision may narrow
and potentially eliminate any New York trial). IAC/MTCH also argue that a trial cannot be scheduled for the foreseeable future due to
COVID-19 issues, while the arbitration can proceed without delay and a decision could be reached in 1H2021. IAC/MTCH further note
that arbitrator selection is already underway, an arbitrator will be appointed this month, and the arbitration panel denied the Plaintiffs'
request to stay the proceedings for 60 days. T hus, IAC/MTCH argue that a postponement in the New York trial “will conserve scarce
judicial resources and promote prompt and efficient resolution of this dispute.” In response, Plaintiffs claim that IAC/MTCH’s request
for a postponement is a desperate attempt to avoid trial, and that “individual litigants cannot be forced to give up their day in court for
arbitration unless they have expressly and knowingly agreed to do so.”

Susquehanna Financial Group, LLLP



Based on our review of the allegations and court filings, we estimate the Plaintiffs are seeking at least $1.3B-$3.5B – plus punitive damages
and interest. At trial, we expect Plaintiffs to present a financial expert who will calculate a range of damages as follows:

• $1.3B-$3.5B�in�Compensatory�Damages:
• $1.3B = Low-End Request: According to court filings, Plaintiffs claim that Tinder should have been given a proper valuation of ~$10B
in 2017; with an 18.5% stake in Tinder, Plaintiffs’ options would have been worth ~$1.85B. Total compensatory damages would then be
$1.3B (subtracting the ~$550M Plaintiffs already received pursuant to the $3B valuation).

• $3.5B = High-End Request: Plaintiffs also argue that the Tinder/MTCH “merger” was improper, depriving them of their ability to
participate in future, higher valuations of their Tinder options (i.e., the value of Tinder as a standalone company). Plaintiffs have recently
claimed that Tinder is currently worth ~$30B. Therefore, we expect that Plaintiffs could argue at trial for ~$3.5B in compensatory
damages, based on the future value of their options.

• Pre-judgment�Interest: Plaintiffs will also seek pre-judgment interest on any compensatory damages if the case reaches the trial stage.
A Plaintiffs’ expert has preliminarily calculated that cumulative pre-judgment interest could end up amounting to ~29% of Plaintiffs’
compensatory damages.

• Punitive�Damages: A Plaintiffs’ expert has preliminary calculated that punitive damages could range from 0 to 2x any compensatory
damages recovered.


We believe the Tinder litigation will present increased headline risk in late 2020/2021, and Plaintiffs will continue to push the Court to
schedule a jury trial at some point in 1H2021. As indicated below, we don’t believe IAC/MTCH will be able to escape without any liability/
financial exposure. Given that the case involves allegations of corporate improprieties and sham valuations, we expect IAC and MTCH
to explore an early settlement of the litigation in order to avoid the uncertainty and increased risk of a jury trial, where potential punitive
damages could create a significant headline verdict. We believe the case will ultimately end in a pre-trial settlement -- our initial base-case
settlement estimate is $300M-$700M. The�following�are�several�factors�that�inform�our�analysis:

• This�Is�Not�a�Case�of�“David�vs.�Goliath”�–�Both�Parties�Have�Significant�Resources: Claims brought by individuals against multibillion-

dollar companies can often lead to relatively low-figure settlements. Defendants/companies are able to devote significant resources to
those cases and can make it prohibitively expensive for individual plaintiffs to continue pursuing their claims. Often, such cases result in
insignificant settlements. Here, however, Plaintiffs are wealthy individuals and are being well-funded through deep-pocketed investors who
are financing Plaintiffs’ lawsuit. Plaintiffs have also retained the law firm of Gibson, Dunn & Crutcher, led by high-profile media attorney Orin
Snyder, who is no stranger to high-stakes, aggressive litigation.

• Litigation�Funding�Will�Cause�Higher�Settlement�Demands: Plaintiffs’ case is being funded by Bench Walk Advisors. Litigation funding
agreements generally contain distribution provisions that allocate the first tier of recovery to the funders (e.g., to compensate them for their
expenses/legal costs plus a profit typically equaling a multiple of their initial investment). The remaining award may then be divided up
according to an agreed-upon formula. For example, one major litigation funder has indicated that in order for it to invest in a case, it needs
the settlement/damages to be at least 10x that of its initial investment so that it can be paid its “investment + profit” upfront, while still
allowing Plaintiffs to earn their expected recovery. Given this funding arrangement, we expect the settlement demands from Plaintiffs to be
much higher in this case, especially given the high-profile nature of the allegations and Plaintiffs' extremely high damages estimates .

• IAC/MTCH�Are�Unlikely�to�Get�the�Case�Dismissed�Pre-Trial: On June 5, 2019, the New York State Trial Court Judge overseeing the case
(Judge Saliann Scarpulla) largely denied IAC/MTCH’s Motion to Dismiss Plaintiffs’ lawsuit. IAC/MTCH appealed that order to the New York
Appellate Division but lost that appeal on October 29, 2019. In July 2020, IAC/MTCH lost a request for permission to appeal the issue to
the New York Court of Appeals (NY's highest court). IAC/MTCH also filed a second Motion to Dismiss on June 3, 2019 based on certain
provisions in Plaintiffs’ litigation funding agreement that they say violate attorney ethics rules. However, at a September 5, 2019 hearing,
Judge Scarpulla made clear that she was almost certainly not going to dismiss Plaintiffs’ lawsuit on this basis. IAC/MTCH will have an
opportunity in the coming months to seek “summary judgment” and argue that Plaintiffs’ claims should be dismissed pre-trial because the
undisputed facts demonstrate that Plaintiffs could not prevail at trial. However, that is a high burden to meet, and we don’t believe IAC/
MTCH will be able to convince a court to dismiss the case pre-trial.

Susquehanna Financial Group, LLLP


• Potential�“Smoking�Gun”�Trial�Evidence: Plaintiffs recently revealed in court filings a series of e-mails/evidence in support of their
“fraudulent valuation” claims. These documents will be used by Plaintiffs to support their allegation that IAC/MTCH orchestrated a corrupt
Tinder valuation process in 2017—and will continue to be used by Plaintiffs to exert pressure over IAC/MTCH in the litigation. For�example:
• February 2020 deposition testimony by former Tinder Director of Finance James Kim (one of the original plaintiffs who dropped out/is
now pursuing arbitration) stating that IAC/MTCH’s “whole model” for valuing Tinder and “most of the assumptions in it” were false and
“were created to present . . . a version of the financials that would result in a low valuation.” Kim also stated the financial info that went
to the banks came directly from MTCH CFO Gary Swidler.

• April 2017 e-mail from Greg Blatt in which, according to Plaintiffs, he admitted his motive for merging Tinder into MTCH was to
“prevent [Plaintiff Sean Rad] from retaining his Tinder equity for at least one more valuation cycle.”

• April 2017 e-mails from Greg Blatt reflecting (according to Plaintiffs) that when he discovered Tinder executives were independently
working on their own financial forecasts, he responded “This is really bad. We need to be controlling everything here[.]” “It’s going to
totally f*ck us. Totally. I don’t know how we didn’t focus on this part of the f*cking process. Goddamnit.”

• June 2017 e-mails from Greg Blatt in which, according to Plaintiffs, he's ordering Tinder executives not to roll out new products while
the valuation process was going on -- “We shouldn’t be rolling out new things . . . until we’re done with this valuation process.”

• A July 2017 e-mail from Greg Blatt stating “We should go after these people. I want to pull e-mails, texts and slacks from that whole
crew and evaluate the cabal. Then we can withhold payment if we want. I'd go scorched earth.”

• IAC/MTCH�Assert�There�Are�No�"Smoking�Gun"�Documents: For example, IAC/MTCH argue that while Plaintiffs' counsel has made
noise about �smoking gun� projections held by James Kim that were hidden during the 2017 valuation process, Kim admitted, when
asked about these �smoking gun� projections during his trial deposition, �that he didn't know what his counsel was referring to.�
According to IAC/MTCH, �Plaintiffs’ litigation strategy is and has always been clear: to smear defendants and hope to prejudice a jury
against them.�

• Could�Mediation/Other�Catalysts�Help�the�Parties�Reach�a�Settlement? In November 2019, IAC/MTCH disclosed that the parties had

agreed to pause depositions in the case because of a recommendation from the judge that they pursue mediation. On January 30, 2020,
the parties participated in formal mediation. While the mediation did not result in settlement/resolution, Plaintiffs informed the Court
in February 2020 (and Defendants agreed) that it was “productive” and that they would be “open to continuing discussions as the case
progresses at the right time.” Additionally, an important pre-trial court ruling on damages could facilitate future settlement discussions.
Plaintiffs argue the July 2017 Tinder/MTCH merger was improper and forced Plaintiffs to exercise their options prematurely at a significantly
discounted rate (and damages should be calculated based on future valuations/“scheduled put” dates). Defendants, however, assert
that damages must be measured as of the date that Plaintiffs’ alleged secret Tinder-MTCH merger took place (i.e., July 2017). The Judge
indicated she may be willing to issue an early ruling on this issue, which could prompt further settlement discussions.


• August�14,�2018: Plaintiffs filed their Complaint against IAC/MTCH.

• January�15,�2019: IAC/MTCH filed their Counter-Lawsuit against Sean Rad.

• June�5,�2019: The Court issued an order largely denying IAC/MTCH’s Motion to Dismiss.

• September�5,�2019: Oral argument on IAC/MTCH’s second Motion to Dismiss arguing that certain provisions in Plaintiffs’ litigation funding
agreement violate attorney ethics rules. At oral argument, the Judge stated she was almost certainly not going to dismiss Plaintiffs’ lawsuit
on this basis – an official ruling is pending.

• October�29,�2019: Appellate court decision denying IAC/MTCH’s appeal of the June 5, 2019 Motion to Dismiss ruling.

• December�2019-January�2020: The parties engaged in mediation/formal settlement meetings that were “productive” but did not result in
a settlement.

Susquehanna Financial Group, LLLP


• June�1,�2020: The Court issued an order dismissing IAC/MTCH’s counter-claim against Sean Rad which sought to claw-back $400M in
compensation. IAC/MTCH are appealing this ruling.

• Fall�2020: Expected decision on IAC/MTCH’s request to stay/postpone any trial in favor of waiting for the related arbitration proceedings to
play out.

• 3Q/4Q�2020: Ruling on IAC/MTCH's second Motion to Dismiss based on certain provisions in Plaintiffs’ litigation funding agreement that
they claim violate attorney ethics rules. The Judge has said she's almost certainly not going to dismiss Plaintiffs’ lawsuit on this basis.

• Late�2020/Early�2021: End of discovery. According to MTCH, document discovery in the case is substantially complete; deposition
discovery had been on pause due to the COVID-19 pandemic but recently resumed. Plaintiffs expect to complete discovery in the case by
early 2021.

• Early�2021: Pre-trial motions.

• ~Mid�2021: Potential Trial.

Susquehanna Financial Group, LLLP


Thomas Claps is a former trial attorney and is currently a Litigation Desk Analyst on SFG's Event Driven/Special Situations Team. Any information contained herein is being
provided only in connection with Mr. Claps’ role as an a Litigation Desk Analyst on SFG's Event Driven/Special Situations Team. The views expressed herein do not constitute
legal advice and do not create any attorney-client relationship. Any underlying facts set forth in this document were gathered from the public domain. Any views taken or
questions answered in this document are general and procedural questions only. Mr. Claps cannot, does not, and will not, provide any legal advice. Mr. Claps has ongoing
confidentiality obligations and obligations to his former clients in connection with the attorney-client privilege, including clients that may be/may have been parties to the
litigation referenced herein. As a result, he is unable to discuss any matters that would conflict with those obligations.
This material is being presented solely as institutional communications and is not meant to be viewed as a complete fundamental analysis of any security. When making an
investment decision this information should be viewed as just one factor in your investment decision process. Disclosures on any of the covered securities mentioned in this
report can be obtained by contacting SFG Compliance toll free at 888-744-6684 or by visiting our disclosure website at https://sig.bluematrix.com/sellside/Disclosures.action.
Susquehanna International Group, LLP (SIG) is comprised of a number of trading and investment related entities under common control, including Susquehanna Financial
Group, LLLP (SFG) member of FINRA. SIG, its affiliates and/or its principals may have long or short positions in securities or related issues mentioned here. SIG, in its capacity
as specialist and/or market maker, may execute orders on a principal basis in the subject securities. Information presented is from sources believed to be reliable, but is not
guaranteed to be accurate or complete. If you click on any links in the document you will be directed to another server. The link is provided for your convenience, SFG does
not endorse the web site, its sponsor, or any of the policies, activities, products, or services offered on the site or by any advertiser on the site.
This is a proprietary SFG product prepared, and intended, solely for the use of sophisticated and professional institutional traders and managers and not for the general
investing public. Unauthorized redistribution of this report, by any means, represents a violation of US copyright laws and could result in legal action and the suspension of
the intended recipient's privileges. If you have any questions regarding this transmission please contact ResearchDistribution@sig.com. The information in this communication
is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation or which
would subject Susquehanna Financial Group, LLLP or its affiliates to any registration requirement within such jurisdiction or country. Copyright © 2020 Susquehanna Financial
Group, LLLP. All rights reserved.

Susquehanna Financial Group, LLLP