Former executive alleges Better.com, CEO misled investors to ensure SPAC deal

Better Home & Finance Holding

08/06/2022 03:35

June 7 (Reuters) - A former Better.com employee is suing the
company and its chief executive, Vishal Garg, alleging they
provided misleading statements to investors about the digital
mortgage firm's financial prospects and performance.
    Sarah Pierce, a former executive vice-president for sales
and operations at the SoftBank-backed company, claimed in her
lawsuit that Garg misrepresented Better.com's statements to
ensure investors go through with a SPAC merger instead of
withdrawing due to its financial condition. 
    A Better.com lawyer said the claims were "without merit". 
    SoftBank  9984.T  did not immediately reply to a Reuters
request for comment.
    Better.com's plan to go public through a merger with a
special-purpose acquisition company (SPAC) Aurora Acquisition
Corp  AURC.O , in a deal that valued it at $7.7 billion, was
agreed to last year and has yet to close.
    SPAC deals were among the hottest investment trends during
the pandemic as early-stage companies looked to go public.
    Pierce said in the lawsuit - filed on Tuesday in a U.S.
district court, southern district of New York - that she was
pushed out of her role in February in retaliation for raising
concerns about the deal. She is seeking financial compensation.
    "We have reviewed the claims in the complaint and strongly
believe them to be without merit," a lawyer for Better.com said
in an emailed statement to Reuters. "The company is confident in
our financial and accounting practices, and we will vigorously
defend this lawsuit," the lawyer added.   
    Founded in 2016 and headquartered in New York, Better.com
offers mortgage and insurance products to homeowners through its
online platform.  
    Last year, Garg had to apologize for his manner of handling
layoffs after a video of him firing 900 employees over a Zoom
call went viral on social media.  urn:newsml:reuters.com:*:nL4N2ST4EL

 (Reporting by Sneha Bhowmik in Bengaluru; Additional reporting
by Mrinmay Dey; Editing by Sherry Jacob-Phillips and Himani
Sarkar)
 ((Sneha.Bhowmik@thomsonreuters.com;))