Investors are suing Tesla Inc (TSLA.O) CEO Elon Musk for insider trading and manipulating Dogecoin, costing them billions.
In a Wednesday night Manhattan federal court filing, investors said Musk utilized Twitter tweets, paid internet influencers, his 2021 “Saturday Night Live” visit, and other “publicity stunts” to trade advantageously at their cost through numerous Dogecoin wallets he or Tesla controlled.
After replacing Twitter’s blue bird emblem with Dogecoin’s Shiba Inu dog design, Musk sold $124 million of Dogecoin in April, raising its price by 30%, investors say.
The suit alleged Musk’s “deliberate course of carnival barking, market manipulation and insider trading” defrauded investors and promoted himself and his companies.
Musk bought Twitter last October. He runs Tesla and SpaceX, a rocket and spaceship company.
Musk and Tesla lawyer Alex Spiro declined to comment on Thursday. The investors’ counsel did not reply to inquiries.
Investors have accused Musk, Forbes’ second-richest person, of artificially inflating Dogecoin’s price by 36,000% over two years and then letting it sink.
A planned third amended complaint in a June lawsuit includes their new charges.
Musk and Tesla sought dismissal of the second amended lawsuit in March, calling it a “fanciful work of fiction,” another amendment was unjustified on May 26.
U.S. District Judge Alvin Hellerstein “likely” allowed the third amended lawsuit on Wednesday, stating that the defendants would not be prejudiced.
Hellerstein also dismissed the Dogecoin Foundation. Its lawyer Seth Levine termed the decision “the appropriate result.”
Johnson et al. v. Musk, U.S. District Court, Southern District of New York, 22-05037.
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