Elon Musk wants to dismiss a lawsuit by former Twitter shareholders who said he waited too long in early 2022 to reveal his large ownership stake in the social media company, saying “all indications” show his delay was a mistake.
In a late Wednesday night filing in Manhattan federal court, Musk called it implausible to believe he wanted to defraud shareholders who didn’t know he had taken a 9.2% Twitter stake, and missed out on big gains because they sold their own stock.
Investors in the proposed class action said Musk and his wealth manager Jared Birchall knew a U.S. Securities and Exchange Commission rule required Musk to disclose by March 24, 2022 he had bought 5% of Twitter, yet waited another 11 days.
The investors said this let Musk buy more shares at cheap prices, saving more than $200 million. Twitter, now known as X, rose 27% on April 4, 2022 after Musk revealed his 9.2% stake.
Musk is the world’s richest person according to Forbes magazine, and runs other companies including electric car maker Tesla (TSLA.O), opens new tab
In his filing, Musk said he had intended to reveal his Twitter stake at the end of 2022, but disclosed it promptly after realizing he misunderstood the SEC disclosure rule.
“This is not a scheme to defraud,” Musk said. “All indications–including those in the pleadings–point to mistake.”
In his filing, Musk said he had intended to reveal his Twitter stake at the end of 2022, but disclosed it promptly after realizing he misunderstood the SEC disclosure rule.
“This is not a scheme to defraud,” Musk said. “All indications–including those in the pleadings–point to mistake.”