Home » Elon Musk faces unusual investor lawsuit in March

Elon Musk faces unusual investor lawsuit in March

by Editorial Team

Elon Musk and the board of Tesla faced an unusual investor lawsuit in early March. The investor said Musk’s comments on Twitter violated a 2018 settlement with the U.S. Securities and Exchange Commission aimed at moderating Musk’s communications.

Chase Gharrity’s complaint was unsealed on March 4 in the Delaware Chancery Court, Economic Times reported. Gharrity claimed that Musk’s “erratic” tweets, including a post last May that Tesla’s stock price was “too high,” and the board’s failure to monitor his compliance with the SEC settlement, have exposed shareholders to billions in losses.

The lawsuit comes at the same time as Musk triggered a bull run with his tweets, helping Bitcoin inadvertently reach a record of $60,000. Gharrity stated that Musk’s actions and the failure of the board to act caused “substantial financial harm.” He demanded that Musk and the board pay damages to Tesla for breaching their fiduciary duties.

Forbes reported that the price of Bitcoin suddenly leaped 20 percent after Musk changed his Twitter bio to “#bitcoin” and posted: “In retrospect, it was inevitable.” 

The rise occurred after the price of Bitcoin dropped to under $30,000 in January.

Meanwhile, on March 19, the Chinese military banned Tesla cars from entering its complexes, citing security concerns over cameras installed on the vehicles. Musk said in turn that his company would “be shut down if its cars were used to spy,” Guardian reported.

“There’s a very strong incentive for us to be very confidential with any information. If Tesla used cars to spy in China or anywhere, we will get shut down,” he said.

The South African-born Musk, who recently added the title “technoking” to his portfolio, is worth $169.8 billion as of March 22, according to Forbes. His net worth sank by $8 billion as the carmaker’s shares fell 5.6 percent on the New York Stock Exchange.

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