Billionaire Elon Musk receives a “heavyweight” lawsuit

Reuters news agency said the plaintiffs are former shareholders of Twitter. They filed a class-action lawsuit against Tesla CEO in Manhattan District Court, New York City, USA, on April 12.

“Mr. Musk made mistakes, mistakes and misrepresentations by not disclosing his investment in Twitter,” reads the content of the shareholder’s class action lawsuit.

In fact, the US Securities Law requires that when investors buy back 5% or more shares of a company, they must disclose it to shareholders within 10 days.

Therefore, the richest person on the planet must now announce his holding of 73.5 million Twitter shares (equivalent to 9.2% of shares) on March 24 instead of April 4 as in fact. These shares are worth nearly 3 billion USD, making him the largest shareholder of this social network.

Immediately after the announcement, Twitter’s share price increased 27.1% from $ 39.31 to $ 49.97 per share. Just a day later, the founder and CEO of SpaceX, also “insinuated” will join the board of Twitter.

However, on April 11, on the personal account Twitter CEO Parag Agrawal said he had sent an offer to Elon Musk, but the world’s richest technology billionaire refused to join the board.

“Musk will not be a member of the board of directors” – said CEO (CEO) Agrawal – “I believe this decision is for the best. We have and will always value input from shareholders. , whether they are on the board or not. Elon Musk is Twitter’s largest shareholder and we will continue to listen to his input.”

Not being on the board allows Musk, a billionaire with 80 million Twitter followers, to buy as many shares as he wants. Joining the board would limit his purchase to 14.9% of common stock during his term and 90 days after.

Billionaire Elon Musk is being sued by class for delay in announcing ownership of 9.2% of Twitter shares. Photo: Fox

Former shareholders led by Marc Rasella said that “withholding information” helped Elon Musk buy more Twitter shares at a lower price, and tricked them into selling at “false inflation” prices. In fact, between March 24 and 29, Rasella shareholders sold off a lot of Twitter shares, with an average price of just $39.23.

Billionaire Elon Musk currently owns a fortune of up to $ 265.1 billion, according to Forbes magazine. If he loses the case, he will have to pay damages to the plaintiff and even be punished by law.

Elon Musk’s lawyer and personal side have not yet commented on the class action lawsuit, but can confirm that the famous electric car company Tesla is not the defendant.

The lawsuit seeks damages and unspecified damages.