Defunct News Startup The Messenger Sued by Fired Employees, Who Demand Severance Payments and Benefits
The Messenger got shot. In the wake of its spectacular flameout this week, the ill-fated digital news startup is the target of a lawsuit seeking class-action status on behalf of its 300 ex-employees — who were terminated without notice — which says the company is on the hook for severance payments and benefits.
The lawsuit, filed Thursday (Feb. 1) in the U.S. District Court for the Southern District of New York, seeks class-action certification. It demands up to 60 days in unpaid wages, accrued vacation time, healthcare insurance coverage and other benefits for sacked employees of The Messenger; plaintiff’s attorneys fees and legal expenses; and “such other and further relief as this Court may deem just and proper.” A copy of the suit is available at this link.
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The suit was filed by Pilar Belendez-Desha, who was a senior producer at The Messenger and previously a producer on Vice Media Group’s “Vice News Tonight,” on behalf of the laid-off Messenger employees. According to the complaint, The Messenger employees were “terminated without cause” and were not provided with advanced written notice of at least 60 days of the layoffs as required by the federal Worker Adjustment and Retraining Notification Act (and without 90 days advance written notice as mandated by the New York WARN Act).
Reps for The Messenger did not respond to email inquiries requesting comment.
It’s not clear if the lawsuit will be successful. For one thing, the WARN Act includes a “faltering company” exception, which the Labor Department explains is applicable when prior to a mass layoff, “a company is actively seeking capital or business and reasonably in good faith believes that advance notice would prevent it from obtaining such capital or business” and that “this new capital or business would allow the company to avoid or postpone a shutdown for a reasonable period.”
The complaint names as a defendant JAF Communications, doing business as The Messenger, which was founded and led by chairman and CEO Jimmy Finkelstein.
Finkelstein raised about $50 million for The Messenger, which launched in May 2023. The Messenger touted itself as an outlet for no-BS reporting with the tagline, “Your Source for Trusted and Unbiased News.” Former employees have alleged The Messenger was set up as a content-aggregation farm, with staffers expected to post a high volume of content to fuel website traffic — which didn’t materialize as expected, leading to a critical cash crunch.
After The Messenger’s funding ran low at the end of 2023, on Jan. 2, 2024, the company “abruptly” terminated approximately 20 employees, according to Belendez-Desha’s suit. On Wednesday, Jan. 31, “the remaining employees learned from a New York Times news item that they were being terminated. Within minutes after the story broke, The Messenger confirmed to the approximately 300 employees that they were terminated effective immediately,” the lawsuit said.
Finkelstein’s final memo to Messenger staff Wednesday, which was reviewed by Variety, blamed “economic headwinds” buffeting the media industry for the company’s immediate shutdown.
“I am personally devastated to share that we have made the painfully hard decision to shut down The Messenger, effective immediately,” Finkelstein wrote. “Over the past few weeks, literally until earlier today, we exhausted every option available and have endeavored to raise sufficient capital to reach profitability. Unfortunately, we have been unable to do so, which is why we haven’t shared the news with you until now. This is truly the last thing I wanted, and I am deeply sorry.”
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