Multiple lawsuits were filed in Los Angeles Superior Court by former members of Cosmic Wire’s senior leadership team allege the company and its chief executive officer Jerad Finck engaged in a sustained, multiyear pattern of conduct in which employees were repeatedly induced to continue working without pay through materially misleading representations regarding the company’s financial condition, funding status and ability to meet payroll obligations.
The plaintiffs, who served in senior leadership roles across core operational and functional areas of the company, allege that ultimate authority and control over financial decisions, payroll and company operations were centralized with the CEO, and that critical financial information was not transparently shared with the broader leadership team during the relevant periods.
The complaints describe an ongoing course of conduct in which the company continued operating while knowingly failing to satisfy wage obligations, relying on repeated assurances of imminent financing that did not materialize. Plaintiffs allege these representations were made consistently over the course of several years, both internally to employees and externally to business partners and prospective investors, to maintain the appearance of financial viability.
According to the filings, internal financial controls and payroll processes were directed by the company’s CEO in a manner that systematically delayed, restricted or selectively processed wage payments after those wages had already been earned. Plaintiffs contend these actions were not isolated or inadvertent, but part of an ongoing, deliberate and repeated practice directed by the company’s CEO at the highest level of the organization to preserve cash flow while maintaining the outward appearance of a functioning enterprise.
The lawsuits further allege that corporate governance mechanisms failed to prevent or correct this conduct. Plaintiffs assert that members of the company’s board of directors were aware of the company’s inability to meet payroll obligations and the ongoing nonpayment of wages yet failed to take corrective action despite the concentration of operational and financial control in the CEO, raising concerns regarding breaches of fiduciary duty and oversight responsibilities.
The complaints also describe a pattern of retaliation against individuals who raised concerns regarding unpaid wages or legal compliance, including termination and other adverse actions, which plaintiffs characterize as efforts to suppress internal reporting and prevent external scrutiny.
In addition, the filings raise serious concerns regarding the allocation and use of corporate funds during periods in which employee wages and benefits remained unpaid, including expenditures and financial decisions that plaintiffs allege prioritized the interests of the CEO over the company’s legal obligations to its workforce.
Plaintiffs further allege that, during these same periods, the company and its CEO pursued or structured parallel business activities and transactions while core obligations to employees and creditors remained outstanding, raising issues relating to potential diversion of assets, fraudulent transfer and breaches of fiduciary duty.
The complaints are supported by contemporaneous communications, internal records and financial documentation that plaintiffs contend reflect a consistent and coordinated pattern of conduct directed by the CEO over time rather than isolated incidents.
Taken together, the actions assert that employees were repeatedly misled, labor was obtained under false or misleading pretenses and wages were systematically withheld as part of an ongoing operational pattern directed at highest levels of the company. Plaintiffs contend this conduct may implicate broader regulatory and enforcement concerns beyond the scope of a traditional employment dispute.
The actions assert claims including violations of California labor laws, retaliation, fraud, breach of contract and related causes, and seek damages, penalties and other relief. The cases are currently pending in the Superior Court of California, County of Los Angeles.
View source version on businesswire.com: https://www.businesswire.com/news/home/20260527096343/en/
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