Dogecoin investors withdraw case against Elon Musk as $259B lawsuit falls flat Dogecoin investors withdraw case against Elon Musk as $259B lawsuit falls flat
Investors dropped the $258 billion Dogecoin lawsuit against Elon Musk without appealing after court finds no evidence of fraud.
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Updated: Nov. 15, 2024 at 11:45 pm UTC
U.S. Air Force / Trevor Cokley / Public Domain. Remixed by CryptoSlate
A high-profile lawsuit accusing Elon Musk of manipulating the price of Dogecoin (DOGE) has officially concluded, with investors withdrawing their appeal of the case’s dismissal, Reuters reported on Nov. 15.
The lawsuit, filed in 2022, alleged that Musk and his electric vehicle company, Tesla Inc., engaged in fraud and insider trading by leveraging Musk’s public influence to manipulate DOGE prices. However, District Judge Alvin Hellerstein dismissed the case in August this year, ruling that the claims lacked sufficient legal basis.
The investors, who initially sought $258 billion in damages, argued that Musk used tweets, media appearances, and promotional stunts to artificially inflate Dogecoin’s value for personal and corporate gain.
They cited Musk’s 2021 Saturday Night Live appearance, where he jokingly referred to Dogecoin as a “hustle,” and his tweet describing it as “the future currency of Earth” as examples of his alleged market manipulation. Hellerstein rejected these arguments, stating that reasonable investors could not interpret such remarks as actionable investment advice or evidence of fraud.
The case also claimed that Musk coordinated trades around his public statements to maximize profits and harm investors. However, the court found no evidence of insider trading or market manipulation. Hellerstein dismissed related claims, stating that the legal theories presented by the investors were inconsistent and unsubstantiated.
Both sides moved to end the legal battle last week, with the investors withdrawing their appeal and Musk’s team withdrawing their motion to sanction the investors’ lawyer for allegedly pursuing a “frivolous” lawsuit.
The investors also dropped their request for sanctions against Musk’s lawyers, whom they accused of interfering with the appeal by demanding excessive legal fees.
A stipulation to dismiss the appeal and related motions was filed on Nov. 14 in Manhattan federal court and is pending final approval from Judge Hellerstein.
Musk, who acquired Twitter in 2022 and rebranded it as X, has faced repeated criticism for his influence on crypto markets. His actions around Dogecoin have sparked debates over the regulatory challenges posed by high-profile figures in speculative markets.
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Assad Jafri
AJ, a passionate journalist since Yemen's 2011 Arab Spring, has honed his skills worldwide for over a decade. Specializing in financial journalism, he now focuses on crypto reporting.
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Dogecoin is a cryptocurrency created in December 2013 as a joke by software engineers Billy Markus and Jackson Palmer.
Tesla
Tesla is a manufacturer of electric vehicles and a clean energy company led by billionaire Elon Musk.
South African-born Elon Musk has founded several companies, including X.com (which later became PayPal), SpaceX and Tesla Motors.