Musk said the delay wasn't intentional and that "all indications" didn't mean to swindle the shareholders (Image-X/Elon Musk)
Billionaire Elon Musk has requested former Twitter shareholders to dismiss a lawsuit alleging that he refused to disclose his substantial ownership stake in early 2022. Musk said the delay wasn’t intentional and that “all indications” didn’t mean to swindle the shareholders. It was stated in a recent filing in Manhattan federal court.
On the other hand, the investors argued that the delay was intentional so that he could purchase more shares at lower prices and it would result in saving over $200 million.
Also Read| Elon Musk VS Rajeev Chandrashekar: A Dispute Over EVMs
The mentioned class action lawsuit asserts that the tech mogul Musk and his manager, Jared Birchall, were aware of the US Securities and Exchange Commission (SEC) rule demanding Musk to reveal his 5% stake in Twitter (now X) within a date of March 24, 2022. They further added 11 more days to receive a favourable response on this matter.
The Tesla owner refused the argument saying that he misinterpreted the SEC rule and waited till the end of 2022 to disclose his Twitter stake in December. “All indications point to mistake and it is not a scheme of defraud,” he added.
Musk stated that as soon as he tacit the rule was corrected on April 1, it was noticed after seven days after the deadline and he promptly halted trading and filed the proclamation on the next trading day. He also rebuts the claim of the investors that an unnamed Morgan Stanley banker assisted in a conspirative strategy to compile Twitter shares notifying the broader market.
Also Read| Elon Musk’s X Sends Legal Notice To Former Employees Asking To Return Overpaid Amount: Report
US District Judge Andrew Carter refused to dismiss an earlier version of the case in September 2022, citing that Musk construed the SEC disclosure and had explicitly stated his mistake under vouch. The lawsuit filed in the name of Oklahoma Firefighters Pension and Retirement System v. Elon Musk et al is progressing in the US District Court In New York.
