Selena Gomez is facing a lawsuit accusing her and her former business partners of fraud involving her mental health startup, Wondermind Global.

Wondermind SRS 44 and Bespoke Wondermind SPV filed a lawsuit in Delaware federal court Thursday, Aug. 13, accusing the 34-year-old actress, her mom Mandy Teefey and their former business partner Daniella Pierson of multiple counts of fraud and breach of contract, according to documents obtained by USA TODAY.

In the complaint, the plaintiffs claim they invested nearly $1.2 million in Wondermind Global in 2022 after Gomez, Teefey and Pierson allegedly “falsely represented that the Company had the infrastructure, leadership, and resources necessary for the Company to launch into a profitable, one-of-its-kind mental health and wellness platform.”

A representative for Pierson addressed the lawsuit in a statement to USA TODAY, saying, “Daniella categorically denies the allegations against her and welcomes the opportunity to present concrete documentation and financial records that establish the facts. To be clear, she has never used investor funds for personal expenses. Quite the opposite: Daniella invested her own money into the business and did not draw a salary from the company.”

USA TODAY has reached out to reps for Gomez and Teefey for comment.

Selena Gomez and Mandy Teefey allegedly lied to Wondermind investors

Among the alleged misrepresentations were that Gomez would be “intimately involved” in the marketing and publicity efforts of the company, that Pierson was a “$200 million executive” with secured partnerships and they had a “full slate of revenue-generating initiatives” already in the works.

However, the lawsuit alleges “the partnerships did not exist. The initiatives never materialized. The app was never built. And for three years, while the Company quietly collapsed around them, not one of its founders, officers, or directors said a word to the investors whose money was funding the collapse.”

The lawsuit cites a September 2025 expose in The Cut, which explored the fall of Wondermind Global. The article alleged Pierson had been ousted from her position as co-CEO following a dispute with Teefey, 50, and that Gomez “had actively sought to distance herself” from the company due to a strained relationship with her mother.

The outlet further alleged Teefey had a “long-running substance abuse problem.” Teefey denied these allegations in an Aug. 13 statement to TMZ.

The suit also points to Forbes reporting in August 2025 that alleged Pierson had exaggerated the success of her previous business ventures. When the plaintiffs contacted Teefey about the claims, she allegedly told them that Pierson had “misappropriated investor funds… to fund her lavish lifestyle.”

According to the lawsuit, the investors say that was the first time they learned of problems within Wondermind, despite Pierson having left the company in 2023. Still, they say Wondermind continued to misrepresent the state of the company, with Teefey allegedly telling investors this April that there was an “escrow account” created to pay them back, but it didn’t actually exist.

Wondermind SRS 44 and Bespoke Wondermind SPV requested a jury trial and are seeking a return of investments in Wondermind, along with damages, costs, attorneys’ fees and any other relief they are entitled to under the law.