Selena Gomez and her mother are being sued for fraud in federal court as investors accuse them and her mother’s close friend of falsely representing their mental health startup’s leadership and partnerships and the time the celebrity singer-actor and her partners would spend on the project, then hiding the fallout for three years.
Wondermind, a startup focused on mental fitness practices and tools, was co-founded by Gomez; her mother, Mandy Teefey; and her friend, Daniella Pierson, in November 2021. The trio of founders allegedly told investors that the brand would feature an app as its centerpiece and be boosted by major advertising deals and attention-grabbing celebrity photo shoots and cover stories.
In a lawsuit filed in Delaware federal court by two companies backed by investors in the mental health brand, Wondermind SRS 44 LLC and Bespoke Wondermind SPV LLC, it’s alleged that the three founders never had a plan to make the company profitable and failed to deliver on the commitments made when investors poured $1.2 million into the startup.
The complaint states that in pitching investors on the company they allegedly abandoned, Gomez, Teefey and Pierson allegedly committed securities fraud, common-law fraud and breach of contract. The lawsuit seeks rescission of the investment contract and damages.
The suit alleges Gomez was touted as a major part of marketing the upstart brand and that Pierson was pitched to investors as a “$200 million executive” with a “full slate of revenue-generating initiatives” already underway.
“The partnerships did not exist. The initiatives never materialized. The app was never built,” the complaint states, adding, “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.”
In a statement to USA Today, Pierson — the 31-year-old entrepreneur who also founded the media company The Newsette while a college sophomore and had a net worth of $220 million as of 2022 — said she “welcomes the opportunity to present concrete documentation and financial records that establish the facts,” while denying that the accusations have merit and arguing she’s an investor, not a fraudster.
“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,” her rep said in the statement.
Investors say they were blindsided by the extent of Wondermind’s dysfunction after a September 2025 exposé by reporter Angelina Chapin in The Cut, who reported that a fight between Pierson and Teefey sent the multimillionaire packing from the brand in early 2023. Chapin also reported in that story — which is cited in the federal lawsuit as containing information unknown to the plaintiffs — that Gomez, reportedly worth well over $1 billion from her Rare Beauty makeup empire, had distanced herself from her mother in recent months and that Teefey was struggling with substance abuse.
While Teefey denied the substance-abuse allegations to TMZ this week, Chapin’s article includes accounts from company staffers describing Teefey’s executive style. Teefey, who is married with a teenage daughter, reportedly frequently slept inside her office at the company’s West Hollywood headquarters, watched sitcoms during the workday as takeout boxes drew flies and appeared intoxicated at work.
Gomez, Teefey and reps for the brand have not responded to The Hollywood Reporter‘s request for comment.
