Selena GomezDaniella PiersonRare BeautyWondermindThe Newsette

Investors claim Selena Gomez's mental health startup Wondermind was a sham in federal lawsuit; report cited fight between Pierson and Teefey

Investors have filed a federal lawsuit against Selena Gomez and her partners, alleging fraud in their mental health startup, Wondermind. The suit claims they misrepresented leadership roles and failed to deliver on commitments after receiving $1.2 million in funding, while internal conflicts reportedly contributed to the company's collapse.

The Hollywood Reporter The Hollywood Reporter14 August 2026 · 23:16 UTC
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Investors are suing Selena Gomez, her mother Mandy Teefey, and business partner Daniella Pierson for fraud, alleging they misrepresented their mental health startup, Wondermind. The lawsuit, filed in Delaware federal court, claims the founders failed to deliver on commitments after receiving $1.2 million in funding.

According to the complaint, Gomez was marketed as a key figure in Wondermind, while Pierson was presented as a “$200 million executive” with numerous revenue-generating initiatives. However, the lawsuit asserts that “the partnerships did not exist. The initiatives never materialized. The app was never built,” and for three years, the founders did not inform investors about the company’s decline.

The lawsuit seeks rescission of the investment contract and damages, highlighting that the founders allegedly had no plan for profitability. Pierson, who has a net worth of $220 million, stated she welcomes the opportunity to present evidence refuting the claims, asserting she has never misused investor funds.

The lawsuit also references a report detailing a fight between Pierson and Teefey that led to Pierson leaving the company in early 2023. Additionally, it mentions Gomez distancing herself from Teefey amid allegations of substance abuse, which Teefey has denied. Staff accounts describe her as frequently intoxicated at work, contributing to the company’s dysfunction.23

Key Insight
“The lawsuit cites a September 2025 report that detailed a fight between Pierson and Teefey leading to Pierson's departure in early 2023. Teefey denied substance-abuse allegations to TMZ, but staff accounts describe her sleeping in her office and appearing intoxicated at work.”
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The Hollywood ReporterThe Hollywood Reporter
“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.”
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