When Chris Gray sold his Shark Tank-backed scholarship search startup Scholly to Sallie Mae in 2023, he thought he had it all. Now, he’s suing the student loan giant for wrongful termination, alleging they are selling user data—often of minors—without consent.

Gray co-founded Scholly a decade ago with the goal of helping students find untapped scholarships more easily. His venture became an unlikely success, attracting investment from Daymond John and Lori Greiner on Shark Tank.

The acquisition promised to scale Scholly’s mission, but what followed was a series of unfulfilled promises and layoffs for Gray and his co-founders. Gray claims Sallie Mae skirted federal regulations by selling data through a subsidiary, despite initial assurances it wouldn’t happen.

“I sold Scholly to a regulated bank because I believed it would protect the students who trusted us,” Gray told TechCrunch. “Instead, I watched the company build a non-bank subsidiary to do things the bank itself can’t legally do: sell student data.”

Sallie Mae denies these allegations, calling them ‘without merit’ and refusing to comment on specific accusations.