Judge Dismisses Dogecoin Manipulation Lawsuit Against Elon Musk and Tesla
Date: 2024-08-30 Author: Oliver Abernathy Categories: BUSINESS
Elon Musk and his electric car company Tesla have won a dismissal of a federal lawsuit alleging they manipulated Dogecoin, causing investors significant financial losses.
U.S. District Court Judge Alvin Hellerstein in Manhattan issued the ruling on Aug. 29, according to court documents.
Investors sued Musk and Tesla in June 2022, after Musk was accused of manipulating the price of Dogecoin using his influence through Twitter posts, appearances on “Saturday Night Live,” and other public appearances.
He allegedly sold Dogecoin at times when his actions, such as changing the Twitter logo to a Shiba Inu, the symbol for Dogecoin, were expected to increase its value. This strategy allegedly allowed him to profit from insider trading.
The lawsuit also alleged that Musk intentionally manipulated the market through public endorsements and statements about Dogecoin that misled investors. The lawsuit referred to these actions as “promotional statements” rather than factual statements. Elon Musk Calls Dogecoin Lawsuit a “Figment of Fantasy” The plaintiffs sought $258 billion in damages, citing the alleged decline in Dogecoin’s value due to Musk’s influence.
However, on March 31, 2023, Musk filed a motion to dismiss the lawsuit. In their defense, his legal team characterized the claims and the $258 billion in damages as “figments of Fantasy.” As a result, they succeeded in getting the case dismissed.
Judge: Musk’s Dogecoin Tweets Are ‘Promotional Statements,’ Not Fraud The judge noted that the plaintiffs had misinterpreted several of Musk’s tweets about Dogecoin. For example, they misunderstood his statement that he would become the official CEO of Dogecoin and his plan to send physical Dogecoin to the moon on a SpaceX rocket.
Hellerstein added that Musk’s tweets were “promotional statements, not factual information subject to verification.”
The judge also ruled that no reasonable investor could base a securities fraud claim on Musk’s tweets. He said it was “impossible to understand” how those tweets could support the plaintiffs’ allegations of market manipulation and insider trading. The court therefore dismissed the allegations.
