Musk and Tesla did not immediately respond to a Reuters request for comment.
A Tesla shareholder filed a lawsuit Thursday accusing CEO Elon Musk of insider trading when he sold more than $7.5 billion worth of shares in the electric car maker in late 2022, saying the billionaire businessman sold shares before potentially disappointing production and delivery numbers were made public.
Shareholder Michael Perry, in the lawsuit filed in Delaware Chancery Court, said Tesla’s stock price plummeted after the company’s fourth-quarter numbers were made public on January 2, 2023, and claimed that Musk “benefited unduly” of approximately US$3 billion in privileged information. profits.
“Musk exploited his position at Tesla and breached his fiduciary duties to Tesla,” the lawsuit said, asking the court to instruct Musk to return profits made from the trades.
According to the lawsuit, Musk sold the shares on several dates, in November 2022 and December 2022.
The lawsuit also accused Tesla directors of breaching their fiduciary duty by allowing Musk to sell the shares.
Musk and Tesla did not immediately respond to a Reuters request for comment.
In the filing, Perry said Musk — who in 2022 said demand for Tesla’s vehicles was “excellent” — discovered the lower-than-expected numbers in mid-November with his access to real-time data, and sold his shares before the deadline. the information was public.
After news of vehicle price discounts that raised concerns about demand and the release of numbers in January, Tesla shares plummeted.
“If (Musk) had waited to make these sales until after the release of material adverse news, … his sales would have yielded him less than 55% of the amounts realized in his November and December 2022 sales,” the lawsuit said .
The lawsuit is the latest legal headache for Musk.
This comes as Musk faces opposition from some Tesla shareholders who are expected to vote on June 13 on whether to ratify his $56 billion pay package, which a Delaware judge overturned in January because she found he improperly controlled the process. .
Tesla is incorporated in Delaware.
Musk is also in the midst of a regulatory investigation to determine whether he violated federal securities laws in 2021 when he purchased shares of the social media platform Twitter, which he later renamed as X. Musk said the U.S. Securities and Exchange Commission was trying to “harass” through unwarranted investigations.
Musk and the top U.S. markets regulator have been in a years-long feud, dating back to 2018, when he tweeted that he had “funding secured” to take Tesla private.
A separate shareholder lawsuit accused Musk of defrauding X investors by delaying disclosing his stake in the social media company to accumulate shares at lower prices.
(Except the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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