Society Pass Incorporated received a $7.4 million judgment from the Supreme Court of the State of New York County on April 15 2026, following a February 5 ruling that found former employee Thomas O’Connor had fraudulently induced the company into certain compensation and warrant agreements. The court also ordered that 250,000 shares of the company’s travel subsidiary, Nusatrip, be placed in escrow, preventing any sale or transfer until the judgment is satisfied.
The judgment is the culmination of a lawsuit filed by O’Connor and CVO Advisors that began with a July 2025 trial. The court’s February ruling confirmed that O’Connor had misrepresented the terms of employee equity, and the April judgment applies the earlier decision, adding interest and a separate award for equity vested before August 2019. The escrow order directly ties the company’s ability to monetize Nusatrip, a key asset in its Southeast‑Asian travel strategy, to the resolution of the litigation.
Financially, the $7.4 million award represents a significant hit to Society Pass’s already strained balance sheet. The company reported a Q3 2025 net loss of $5.28 million on revenue of $1.38 million, a decline from $1.68 million in the same period in 2024. Coupled with a Nasdaq bid‑price deficiency that has left its shares trading below $1.00, the judgment adds pressure on cash reserves and could accelerate the company’s risk of delisting if liquidity is not restored.
Nusatrip’s value is central to Society Pass’s growth plans. The subsidiary was slated for a spin‑off alongside Thoughtful Media Group to unlock shareholder value, but the escrow order freezes 250,000 shares—roughly a quarter of the company’s outstanding equity—thereby delaying any proceeds that could have been used to fund operations or reduce debt. The restriction also undermines the company’s ability to leverage Nusatrip as collateral or a strategic asset in future financing.
Management has indicated it will pursue an appeal of the judgment and the escrow order, citing the need to protect the company’s interests while the litigation proceeds. The legal dispute remains a key risk factor in Society Pass’s filings, and the court’s decision underscores the potential for further financial penalties and operational constraints as the case moves forward.
The judgment and escrow order add to an already precarious financial position, heightening concerns about the company’s ability to meet regulatory requirements and continue its expansion plans in Southeast Asia. Investors and analysts will likely view the ruling as a significant headwind that could delay or alter Society Pass’s strategic initiatives, including the planned spin‑offs and broader market entry efforts.
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