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Vishal Garg sues Better board over poison pill in Delaware court
Garg alleges the board used a poison pill to block shareholder voting rights, after Better terminated him as CEO on Aug. 3.
HousingWire reports that ousted Better Home & Finance founder Vishal Garg has filed suit in Delaware Chancery Court against the company’s board and interim CEO Daniel Lewis, challenging his removal and later corporate actions.
In the complaint, Garg says the board relied on “lies and manipulation” to fire him and adopted a poison pill to entrench themselves and thwart shareholder voting rights. He also asks the court to invalidate the poison pill and the formation of a special committee.
Garg alleges Lewis, an activist hedge fund manager, maneuvered onto the board on July 27 and then pushed for Garg’s termination without notice or cause on Aug. 3. The filing also cites Better’s stock being down nearly 60% since the ouster, and describes stockholders as rebelling against the board’s actions.
The suit further outlines deal proposals Garg says were offered after his termination, including a vice chairman and advisor role with a $750,000 per year cash component and an equity award of 875,000 shares. Garg declined that offer, according to the complaint, and he says he later gathered consents for a board shake-up after two directors offered resignations tied to 50.1% stockholder support, though he claims an administrative error caused him to overstate support to 51.65% versus roughly 45%.