Elon Musk has successfully dismissed a lawsuit due to a lack of evidence that alleged that he and Tesla manipulated the price of Dogecoin for financial gain.
Elon Musk, the CEO of Tesla, has effectively dismissed a federal lawsuit that accused him and Tesla of defrauding investors through promoting and trading the cryptocurrency Dogecoin.
The legal decision, rendered by a U.S. District Judge in Manhattan, is a significant development for the cryptocurrency community and Musk, and it raises concerns regarding the future trajectory of Dogecoin’s price.
Dogecoin Trading Lawsuit Dismissal Granted to Elon Musk
The lawsuit filed in Manhattan federal court against Elon Musk and Tesla, Inc., which accused them of manipulating the price of Dogecoin for personal gain, has been dismissed, according to a Reuters report.
Investors had claimed that Musk and Tesla engaged in insider trading and employed publicity stunts, such as social media posts and television appearances, to inflate the cryptocurrency’s price by more than 36,000% before allowing it to collapse.
The lawsuit alleged that the Tesla CEO profited from selling cryptocurrency at its peak after orchestrating market movements.
U.S. District Judge Alvin Hellerstein dismissed the lawsuit after investors could not substantiate their claims in five distinct versions that were filed over two years.
Elon Musk and Tesla’s legal teams contended that there was insufficient concrete evidence to establish that they owned the wallets involved in the purported trading activities or that any misconduct occurred in connection with Dogecoin.
Complaints of Market Manipulation and Insider Trading
The lawsuit alleged that the Tesla CEO manipulated the market value through various high-profile actions, including a 2021 appearance on NBC’s “Saturday Night Live,” in which he referred to Dogecoin as a “hustle” while assuming the role of a fictitious financial expert.
The plaintiffs contended that these actions were part of a more extensive scheme to capitalize on the cryptocurrency’s volatility by acquiring it before public announcements and selling it after prices had increased.
Investors specifically cited Elon Musk’s April 2023 decision to temporarily replace the Twitter logo with DOGE’s Shiba Inu dog, which resulted in a 30% increase in the stock price. They claimed that this maneuver enabled Musk to sell the token at an exorbitant price.
Nevertheless, the judge determined that the plaintiffs did not present the necessary evidence to establish that these activities constituted fraud or that the statements made by SpaceX’s CEO on social media were intended to deceive investors.
Musk’s attorneys contended that his tweets and public statements regarding the cryptocurrency were “innocuous and frequently silly” instead of deliberately attempting to manipulate the market or establish a pyramid scheme. They argued that Musk’s social media conduct, including his well-known fondness for parodies, did not violate securities law. The legal team also contended that the plaintiffs had not established any direct correlation between Musk’s social media activity and specific trading outcomes that would qualify as insider trading.
Consequently, the court ultimately sided with Musk, concluding that there was no direct evidence of any wrongdoing or that he or Tesla profited from suspicious transactions. The judgment effectively concludes a legal dispute that had previously included a substantial demand for $258 billion in damages.
The closure of the X headquarters has contributed to Musk’s eventful week.
At the same time, X, previously known as Twitter and also owned by Elon Musk, announced that its San Francisco headquarters would be closing on September 13. The company’s global headquarters, established in 2012, will cease operations after over a decade of operation. The closure date is a Friday, which is also the superstitious date of Friday the 13th. These events have preceded the Tesla CEO’s allegation of a Brazilian Judge for engaging in a misguided legal maneuver by issuing him a subpoena.
In the interim, the Meme token price rebounded following the announcement as the investors successfully regained market control. At the time of publication, the price of DOGE was $0.1006, representing a 0.45% increase from the support level.
Additionally, an analyst, Trader Tardigrade, has indicated that DOGE has attained the zenith of its bearish momentum. The crypto analyst posits that the Dogecoin price is exiting the diamond bottom reversal pattern, a precursor to a bullish breakout.
