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  • Voltaire Staff

Musk says failure to reveal Twitter stock was 'mistake,' seeks lawsuit dismissal


 

Billionaire Elon Musk has sought the dismissal of a lawsuit by former Twitter shareholders -- who claimed he waited too long in early 2022 to reveal his big ownership stake in the company --, by claiming his delay was a "mistake."

 

Filing his deposition in Manhattan federal court on Wednesday, Musk said it was implausible to believe that he wanted to defraud shareholders who were unaware he had taken a 9.2 per cent Twitter stake, and missed out on big profit because they sold their stock. 

 

According to Reuters, investors in a proposed class action have alleged Musk and his wealth manager Jared Birchall knew the US Securities and Exchange Commission rule required the billionaire to disclose that he had bought 5 per cent of Twitter by March 24, 2022, yet he waited another 11 days.

                                                                                                                 

The litigants claim the non-disclosure allowed Musk to buy more shares at cheaper prices (more than $200 million).


On April 4, 2022, in the wake of Musk's disclosure that he had 9.2 per cent stake in the company, Twitter's stock rose by 27 per cent.

 

According to Forbes magazine, Musk is the world's richest person and runs several other companies, including electric car maker Tesla.

 

In his Wednesday filing, Musk said he wanted to reveal his Twitter stake at the end of 2022 but disclosed it promptly after realising he had misunderstood the SEC disclosure rule.

 

"This is not a scheme to defraud... all indications including those in the pleadings point to mistake," said Musk.

 

Musk also denied the claim made by investors that an unnamed banker helped him devise a trading strategy to shore up Twitter shares without informing the market.


Musk bought San Francisco-based Twitter for $44 billion in October 2022. The purchase has been a matter of probe by the SCE.


Last September, US District Judge Andrew Carter refused to dismiss the previous version of a lawsuit after finding that Musk understood the SEC disclosure and testified about it under oath.

 

The case is Oklahoma Firefighters Pension and Retirement System v Musk et al, U.S. District Court, Southern District of New York, No. 22-03026.


Image Source: Wikipedia

 

 

 

 

 

 

 

 

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