A judge has dismissed the lawsuit against Elon Musk, determining that his statements were merely promotional and not fraudulent.
Elon Musk, the CEO of Tesla Inc., has successfully dismissed a high-profile $258 billion lawsuit that accused him and his company of manipulating the price of Dogecoin (DOGE), the popular meme-based cryptocurrency.
On Thursday, U.S. District Judge Alvin Hellerstein dismissed the claims made by a group of disgruntled investors, ruling in favor of Musk and Tesla.
A group of Dogecoin holders launched a lawsuit in June 2022, alleging that Musk and his business fraudulently inflate the token’s price through social media and public statements. Subsequently, the token crashed, resulting in substantial financial losses for the holders.
The plaintiffs contended that the meme coin’s price increased by over 36,000% over the course of two years as a result of Musk’s tweets and public endorsements, which ultimately led to its decline.
Judge Hellerstein disregarded the accusations, determining that the SpaceX CEO’s statements were “puffery” and “aspirational” rather than actionable claims. The judge also concluded that the statements were “factual and susceptible to being falsified” and that “no reasonable investor could rely upon them” as a basis for making investment decisions.
The complainants had cited a number of the 53-year-old’s tweets as evidence of material misrepresentations, such as his proclamation that he would become the “official CEO of Dogecoin” and his assertion that he might place a “literal Dogecoin” on a SpaceX rocket and launch it to the moon.
The investors also accused the tech billionaire and his electric vehicle company of engaging in a “pump and dump” scheme with the meme coin. Nevertheless, the judge determined that they had neglected to offer a logical and convincing explanation for the two individuals’ involvement in the situation.
Hellerstein stated in his decision that the allegations that underpin plaintiffs’ assertions of market manipulation are incomprehensible.
Musk’s legal team had previously attempted to dismiss the case, contending that his accusers had not demonstrated how he intended to defraud anyone or what risks he had concealed, according to a March 31 Reuters report.
They argued that his tweets, which included phrases such as “Dogecoin Rulz” and “no highs, no lows, only Doge,” were too ambiguous to substantiate allegations of fraud.
His attorneys contended that there is nothing illegal about disseminating humorous images or expressing support for a legitimate cryptocurrency that maintains a market capitalization of nearly $10 billion.
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