Tesla shareholder sues Musk for alleged $7.5 billion insider trading By Reuters

(Reuters) – A Tesla (NASDAQ:) shareholder filed a lawsuit on Thursday accusing CEO Elon Musk of insider trading when he sold more than $7.5 billion in shares of the electric car maker in late 2022, saying the businessman… The billionaire sold the stock before it was disappointing. Production and delivery numbers have been announced.

Shareholder Michael Perry, in the lawsuit filed in Delaware Chancery Court, said Tesla's stock price fell after the company's fourth-quarter numbers were released on Jan. 2, 2023, and claimed Musk “improperly benefited” from about $3 billion in inside information. Profits.

“Musk took advantage of his position at Tesla and breached his fiduciary duties to Tesla,” the lawsuit said, and asked the court to direct Musk to return the profits he made from the deals.

According to the lawsuit, Musk sold shares on different dates in November 2022 and December 2022.

The lawsuit also accused Tesla's directors of violating their fiduciary duties by allowing Musk to sell stock.

Musk and Tesla did not immediately respond to a Reuters request for comment.

In the lawsuit, Perry said that Musk – who said in 2022 that demand for Tesla cars was “excellent” – discovered the lower-than-expected numbers in mid-November, through access to real-time data, and sold his shares before the beginning of the year. The information was general.

After news of vehicle price cuts raised concerns about demand and the release of numbers in January, Tesla stock fell.

The lawsuit stated: “If (Musk) had waited to make these sales until after the publication of negative material news, his sales would have generated less than 55% of the amounts he achieved from his sales in November and December 2022.”

The lawsuit is Musk's latest legal headache.

This comes as Musk faces opposition from some Tesla shareholders who are scheduled to vote on June 13 on whether to ratify his $56 billion pay package, which a Delaware judge invalidated in January because she found he controlled… The operation is incorrect.

Tesla was founded in Delaware.

Musk is also conducting a regulatory investigation to determine whether he violated federal securities laws in 2022 when he bought shares in the social media platform Twitter, which he later renamed X. Musk said the SEC was trying to “harass” people. On him through unjustified investigations.

Musk and the top US markets regulator have been in a long-running feud, dating back to 2018, when he tweeted that he had secured “funding secured” to take Tesla private.

A separate shareholder lawsuit accused Musk of defrauding X investors by delaying the disclosure of his stake in the social media company to raise shares at lower prices.

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