Key Takeaway:
Elon Musk and his companies, SpaceX and Tesla, emerged victorious as a US court dismissed a $258 billion class action lawsuit alleging a “crypto pyramid scheme.”
Musk’s Dismissal of Lawsuit
Judge Alvin Hellerstein of the US District Court for the Southern District of New York dropped the lawsuit seeking $258 billion in damages after almost two years of legal proceedings. The lawsuit claimed that Musk manipulated Dogecoin’s price, leading to investor losses, which Musk vehemently denied and the court ultimately dismissed.
Musk’s Defense and Court Decision
In response to the allegations, Musk’s legal team argued that his social media support for Dogecoin was not sufficient evidence of fraud, persuading the court to dismiss the case. Judge Hellerstein ruled that Musk’s statements about Dogecoin were “aspirational and puffery” rather than factual, and not reliable for investment decisions. The court found no evidence to support claims of market manipulation, insider trading, or a “pump and dump” scheme.
Musk’s Relationship with Cryptocurrency
Despite his past involvement with cryptocurrencies, Musk has distanced himself from the sector in recent times. His company, Tesla, which once embraced Bitcoin, reversed its decision on accepting it as a form of payment following his appearance on SNL. However, Tesla reportedly maintained its Bitcoin holdings, indicating ongoing interest in the digital asset market.
