Selena Gomez and her mother have been accused of defrauding investors in their mental health startup, according to a federal lawsuit.
Wondermind was founded by Gomez her mother, Mandy Teefey, and Daniella Pierson, in November 2021. The lawsuit accuses them of misleading investors and concealing fraud.
Among the accusations are that investors, who put $1.2 million into the company, expected Gomez to be more involved in the company. Wondermind describes itself as a business focused on mental fitness practices and tools, but, according to the lawsuit, there was little follow-through on supposed plans to make the company successful.
"Gomez purported to sign a contract obligating her to perform and then ignored it. The partnerships did not exist. The initiatives never materialized. The app was never built," reads a passage of the lawsuit. "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 five investors want their money back plus damages. Wondermind claimed a valuation of $95 million in 2022. It also claimed that it had numerous partnerships with companies such as JPMorgan. But the lawsuit alleges the partnerships never existed.
Pierson denied several of the allegations made in the lawsuit in a statement to USA Today: "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."
The lawsuit comes after an expose last year in The Cut that documented leadership and management problems at the company. According to The Cut, the relationship between Pierson and Teefey declined quickly, eventually leading to Pierson leaving as co-CEO about a year after the company's launch.
According to The Cut story, employees described Teefey as spending hours in her office watching TV, surrounded by takeout boxes and packages from luxury brands.
According to The Cut, the company began having cash flow problems and failed to pay employees on time in March and May of 2025. Throughout the story, which includes various anonymous sources, employees repeatedly say that Teefey wasn't capable of running the company.
