According to PANews, Elon Musk and his electric vehicle company Tesla have successfully won the dismissal of a federal lawsuit accusing them of defrauding investors by inflating the value of the cryptocurrency Dogecoin and engaging in insider trading, resulting in billions of dollars in losses. The ruling was issued by U.S. District Judge Alvin Hellerstein in Manhattan on Thursday evening.
Investors alleged that the world's richest man used Twitter posts, an appearance on NBC's 'Saturday Night Live' in 2021, and other promotional stunts to profit from trades in Dogecoin wallets controlled by him or Tesla at the expense of investors. They claimed that Musk intentionally drove up Dogecoin's price by over 36,000% within two years before allowing it to plummet, and that he and Tesla frequently timed their trades based on Musk's public statements and activities related to Dogecoin.
However, Hellerstein stated that Musk's tweets about Dogecoin being the future currency of Earth, being used to purchase Tesla vehicles, or being sent to the moon by his company SpaceX were 'idealistic and exaggerated, not factual and easily falsifiable,' meaning that no rational investor could rely on these tweets to bring a securities fraud lawsuit. As a result, the judge found the market manipulation and insider trading claims 'incomprehensible' and dismissed the lawsuit with prejudice, meaning it cannot be refiled. Investors initially sought $258 billion in damages and amended their complaint four times over two years. Musk's lawyers argued that his 'harmless and often silly tweets' were not problematic and that there was no evidence Musk owned two wallets for suspicious trading or that he or Tesla ever sold Dogecoin.
