ID Experts Sued for Merger Payments Over Federal Contract (1)

ID Experts and its private equity parent were sued in Delaware by its former owners, who claim they’re owed a $7.2 million post-merger milestone payment over the company’s $400 million data security contract with the federal government.

The Chancery Court lawsuit accuses ID Experts’ new owner—a holding company backed by nonparty Rogue Venture Partners—of holding back the sum, which represents more than 10% of the sale price, over a willful misreading of the purchase agreement’s “earnout” provision.

It was filed Thursday by the litigation representative of ID Experts’ former shareholders

The 2016 agreement allegedly conditioned the seven-figure earnout on the ...