Selena Gomez sued for fraud over mental health start-up

A Delaware federal court filing accuses Selena Gomez, her mother, and a co-founder of defrauding investors out of nearly $1.2 million through their mental health startup, Wondermind Global, according to court documents reviewed by Thewrap. Filed by investing entities Wondermind SRS 44 LLC and Bespoke Wondermind SPV I LLC, the lawsuit alleges that the leadership trio spent three years quietly watching the venture collapse while keeping financial backers completely in the dark.

The plaintiffs claim the founders secured funding by falsely representing that the company possessed the necessary infrastructure, leadership, and resources to build a profitable mental health platform. Instead, according to NBC News, the promised app was never built, anticipated advertising partnerships did not exist, and high-profile celebrity cover stories failed to materialize. The complaint states that while the enterprise dissolved around them, not a single officer or director notified the investors whose capital was funding the descent.

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Wondermind was launched in late 2021 by Gomez, her mother Mandy Teefey, and entrepreneur Daniella Pierson, with a stated mission to democratize and destigmatize mental health through daily content, physical tools, and a supportive community. From the outset, investors relied heavily on the star power and business projections associated with the founders. The lawsuit asserts that Gomez was contractually obligated to serve as head of marketing and remain intimately involved in publicity, yet she allegedly ignored the agreement entirely.

The quiet collapse of the startup was eventually exposed through investigative media reports rather than corporate disclosures. According to Us Magazine, the plaintiffs learned of the internal dysfunction through an August 2025 Forbes article detailing friction among executives, followed by a September 2025 exposé in The Cut. That reporting revealed that Wondermind had laid off 60 percent of its staff amid cash crunches, that employees had not been paid on time, and that simmering family and executive disputes had paralyzed operations.

The legal complaint outlines multiple counts of securities fraud, common law fraud, equitable fraud, and breach of contract against the defendants. It further alleges that Teefey struggled with substance abuse that impeded her leadership, and notes that Pierson was pushed out of the company in January 2023 following a dispute with Teefey. Before the lawsuit, Teefey vehemently denied allegations regarding substance abuse and mismanagement, telling Us Magazine last year that the claims were false and driven by disgruntled employees.

Meanwhile, legal representatives for Daniella Pierson have issued a strong defense. A spokesperson for Pierson told Yahoo News that she categorically denies the accusations and welcomes the chance to present financial records. The spokesperson maintained that Pierson never drew a company salary and instead invested her own personal funds into the venture.

Following the investigative reports, investors sent a formal notice of rescission demanding their money back. The lawsuit alleges that Teefey responded by assuring investors that an escrow account existed to return their funds, only to disappear when pressed for account details by representatives from Bespoke.

The plaintiffs are demanding a jury trial, the recovery of legal fees, and the complete rescission and return of their nearly $1.2 million investment.

Legal Claims and Financial Projections Detailed in Court Documents

According to NBC News, the plaintiffs maintained that their financial backing was secured through ambitious projections provided by Daniella Pierson in June 2022, which included expectations of closing significant advertising revenue and achieving a future valuation exceeding $4 billion. The legal complaint, filed by Wondermind SRS 44 LLC and Bespoke Wondermind SPV I LLC, outlines specific claims against individual defendants:

• Wondermind and all founders face counts of securities fraud, common law fraud, and equitable fraud.
• Daniella Pierson faces additional individual counts of securities fraud, conversion, and unjust enrichment.
• Wondermind faces specific contractual claims regarding the use of investor proceeds and failure to satisfy conditions precedent.

Before the federal lawsuit materialised, public scrutiny intensified when Forbes published an August 2025 investigative report scrutinizing Pierson's business background and her past venture, The Newsette. The article prompted investors to contact Mandy Teefey for explanations regarding company funds, as detailed by NBC News.