A federal judge has dismissed a class action lawsuit accusing Tesla CEO Elon Musk of manipulating the market through his public endorsements of Dogecoin. The plaintiffs, representing investors who claimed to have lost significant amounts of money due to Musk’s social media comments, sought $86 billion in damages, with a request to triple that amount, bringing the total to $258 billion.
The lawsuit focused on Musk’s various statements about Dogecoin, primarily made on X (formerly Twitter) between 2021 and 2023. The plaintiffs argued that Musk’s statements misled investors, leading to substantial financial losses.
“These statements are aspirational and puffery, not factual and susceptible to being falsified,” U.S. District Judge Alvin K. Hellerstein wrote in his ruling. “They cannot be the basis of a lawsuit, and no reasonable investor could rely upon them.”
Initially filed in June 2022 and amended four times, the lawsuit was later expanded to include accusations of insider trading. The plaintiffs’ attorneys also accused Tesla’s legal counsel of harassment, a charge the team described as “unfounded and audacious.”
Judge Hellerstein remarked that the remaining claims by the plaintiffs were unclear, stating, “It is not possible to understand the allegations that form the basis of plaintiffs’ conclusion of market manipulation, a ‘pump and dump’ scheme, breach of fiduciary duty amounting to insider trading, or the state law claims.”
Despite the dismissal, plaintiffs’ attorneys argued that Musk’s statements went beyond mere puffery, causing billions of dollars in losses. They vowed to seek justice through the Second Circuit Court of Appeals, which they believe will rule in their favor.
Dogecoin, which started as a parody cryptocurrency in 2013, has since become one of the world’s most valuable digital assets, reaching the top 10 in market capitalization by April 2021. According to CoinGecko, Dogecoin currently has a market cap of $14.5 billion, with a price of $0.10.
The case highlighted some of Musk’s most famous Dogecoin moments, including his appearance on Saturday Night Live, where he referenced Dogecoin in both his opening monologue and a later skit. The lawsuit also cited Musk’s promise to send Dogecoin to the moon via SpaceX and pay for the mission using the cryptocurrency.
Musk’s public enthusiasm for Dogecoin continued even as the legal battle unfolded, including an instance last year when the logo of X was temporarily replaced with the Dogecoin mascot, a Shiba Inu.
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