Elon Musk, along with his electric vehicle company Tesla, has successfully defended himself against a federal lawsuit that accused them of manipulating Dogecoin and causing significant financial harm to investors.
On August 29, US District Judge Alvin Hellerstein in Manhattan issued the ruling, as revealed in court documents.
The lawsuit was initiated by investors in June 2022, alleging that Musk used his influence via Twitter, appearances on "Saturday Night Live," and various publicity tactics to manipulate the price of Dogecoin.
It was claimed that he sold Dogecoin at strategic moments, particularly when actions like changing Twitter's logo to the Dogecoin Shiba Inu dog were anticipated to boost the cryptocurrency's value. This conduct was said to enable him to engage in insider trading for profit.
Additionally, the lawsuit accused Musk of purposely misleading the market through his public endorsements and comments regarding Dogecoin, labeling these actions as "puffery" rather than based on truth.
In response to the allegations, Musk referred to the lawsuit as a “fanciful work of fiction,” with his legal team arguing for its dismissal. They characterized the claims and the $258 billion in damages sought by the plaintiffs as baseless.
Judge Hellerstein noted that the plaintiffs had misinterpreted many of Musk's tweets concerning Dogecoin. For instance, they misconstrued his statement about becoming the "official CEO" of Dogecoin and his assertion of sending a physical Dogecoin to the moon on a SpaceX mission.
The judge characterized Musk's tweets as “aspirational and puffery, not factual and susceptible to being falsified.” He further ruled that no rational investor could substantiate a securities fraud claim based on Musk’s tweets. It was deemed “not possible to understand” how the tweets supported claims of market manipulation and insider trading. Consequently, the court dismissed the allegations.
As of now, the value of Dogecoin has seen a slight decline of 0.3%, trading around $0.10.
