Beijing time on May 27 news, Twitter Inc. investors sued billionaire Elon Musk (Elon Musk), accusing him of manipulating the company’s stock price decline. Musk previously offered to buy the social media platform for $44 billion.
Investors said Musk saved himself $156 million by buying more than 5% of Twitter shares before March 14, but he did not disclose the news. They asked the court to classify the lawsuit as a class action and seek an unspecified amount of punitive and compensatory damages.
Investors also named Twitter as a defendant, saying the company was obligated to investigate Musk’s actions, although they did not seek damages from the company, according to a lawsuit filed Wednesday in federal court in San Francisco. Investors said Musk continued to buy shares after that, eventually disclosing in early April that he owned a 9.2% stake in the company.
Investors led by Virginia resident William Heresniak said: “By delaying disclosure of his Twitter stake, Musk participated in a market manipulation to buy Twitter at artificially low prices. Tesla stock.” Investors say the recent drop in Tesla’s share price has put Musk’s ability to finance a Twitter acquisition in “significant jeopardy,” as he has pledged his own stock to get what it needs to buy Twitter loan.
According to previous reports, Musk’s delay in disclosing his Twitter shares has been investigated by the SEC.
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