Another lawsuit has been filed against Elon Musk in connection with his planned takeover of Twitter. Investors have sued Tesla CEO Elon Musk for allegedly manipulating stock prices ahead of his $44 billion takeover proposal, according to Reuters.
Musk allegedly saved $156 million by neglecting to disclose that he had purchased more than a 5% stake in Twitter by March 14th, as he did in a previous action. Musk just reported his investments in early April, when he revealed that he possessed a 9.2 percent stake in the social network, according to the investors.
According to the investors, Musk’s post-announcement utterances amounted to manipulation as well. They were particularly alarmed by his suggestion that the agreement was “on hold” until Twitter could demonstrate that bots were not a huge issue and accounted for fewer than 5% of all accounts.
The plaintiffs in this complaint are seeking class-action status and specific damages if they succeed. Twitter has declined to comment, while Musk has yet to react to a request from Reuters.
Musk’s anticipated purchase has already resulted in a flurry of legal action. A Florida pension fund sued Musk for allegedly breaking a Delaware statute that would prevent the merger until 2025, in addition to the April action.
Meanwhile, the Securities and Exchange Commission is looking into Musk’s disclosure timeliness. Although none of these initiatives are certain to succeed, they nonetheless constitute a severe threat to Musk’s objectives.
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