Billionaire Richard Branson must face fraud suit from Virgin Galactic shareholders

Billionaires

Billionaire Richard Branson must face a lawsuit filed by Virgin Galactic shareholders who allege Branson hid issues with the space program and sold nine figures worth of stock at inflated prices, a federal judge ruled Monday, marking another hurdle for Branson’s already embattled pursuit of commercial space flight.

In this photo illustration, British billionaire Richard Branson is seen on a fragment of a Virgin Galactic Unity 22 Spaceflight Livestream Youtube video displayed on a smartphone with the Virgin Galactic logo in the background.  | Photo Illustration by Pavlo Gonchar/SOPA Images/LightRocket via Getty Images
In this photo illustration, British billionaire Richard Branson is seen on a fragment of a Virgin Galactic Unity 22 Spaceflight Livestream Youtube video displayed on a smartphone with the Virgin Galactic logo in the background. | Photo Illustration by Pavlo Gonchar/SOPA Images/LightRocket via Getty Images

Branson founded Virgin Galactic in 2004 but suffered setbacks including a botched testflight in 2014 that killed co-pilot, Michael Alsbury. After more than a decade of being funded largely by Branson’s billion-dollar fortune, Virgin Galactic went public in October 2019 by merging with a special-purpose acquisition company.

The company is aiming to offer brief flights to the edge of space to tourists willing to pay for six-figure tickets. Virgin Galactic’s competitors include other companies founded by wealthy businessmen in what has been dubbed a “billionaire space race” between Branson’s Virgin Galactic, Jeff Bezos’ Blue Origin and Elon Musk’s SpaceX. While Virgin Galactic has not launched a flight since Branson’s July 2021 trip on Unity, Blue Origin has sent up six tourist space flights since 2021, and SpaceX has launched two.

Forbes Valuation

We estimate Branson is worth US$3.7 billion thanks to his conglomerate of businesses under the “Virgin” brand name, like Virgin Atlantic and Virgin Galactic.

What To Watch For

Branson announced in February that Virgin Galactic will soon start taking reservations for US$450,000 tickets for space flights, which he said at the time would begin “later this year,” but now the company aims to launch commercial flights in spring 2023.

This article was first published on forbes.com

Further Reading

Richard Branson must face lawsuit in U.S. over Virgin Galactic space travel problems (Reuters)

Virgin Galactic Shares Surge 30% After Billionaire Branson-Backed Firm Announces $450,000 Tickets To Space (Forbes)