Elon Musk Wins Dismissal of Lawsuit Accusing Him of Defrauding Investors by Hyping Dogecoin

A lawsuit was filed against Musk and his electric vehicle company Tesla accusing them of defrauding investors by hyping Dogecoin and conducting insider trading.

A lawsuit against Elon Musk and his electric vehicle company Tesla, accusing them of defrauding investors by hyping Dogecoin and conducting insider trading, has been dismissed by a U.S. judge.

Investors had filed the lawsuit in 2023, alleging that Musk used his influence, particularly through Twitter and his appearance on NBC's “Saturday Night Live,” to manipulate the price of Dogecoin.

They claimed that Musk drove the price of Dogecoin up by 36,000% over two years, before selling his Doge holdings and causing the price to crash, leading to huge financial losses for investors. The investors also suggested that Musk was involved in insider trading, timing his trades to coincide with his public statements.

The lawsuit also highlighted incidents such as when Musk changed the logo of Twitter from the blue bird to the Dogecoin logo in April 2023, which allegedly caused the price of the cryptocurrency to spike by 30%. They alleged that Musk sold his Doge holdings shortly afterward.

However, U.S. District Judge Alvin Hellerstein in Manhattan was not convinced by the investors' claims. He stated that the tweets by Elon Musk related to Dogecoin were mere aspirations, not meant to be taken literally.

"To the extent that Musk's statements regarding Dogecoin in these tweets were objectively false and puffery, they are not actionable under the securities laws," Hellerstein wrote.

"No reasonable investor could have been misled by Musk's statements in these tweets, which a reasonable investor would have recognized as completely immaterial to the value of theDogecoin."

Hellerstein also found the insider trading claims to be too vague, stating that it was “not possible to understand” the accusations.

With these conclusions, the judge dismissed the case with prejudice, meaning it cannot be refiled.

Alex Spiro, a lawyer for Elon Musk, celebrated the dismissal of the lawsuit, saying that it was "a very good day for Dogecoin."

Musk's legal team had argued that his tweets were harmless and that there was no evidence of any illegal activity related to Dogecoin trading.

Elon Musk has a history of making comical tweets about various cryptocurrencies, and his statements should not be taken as a signal to buy or sell any crypto.

This ruling clears the name of Elon Musk from any wrongdoing with Dogecoin, but it remains to be seen how this will affect the price of Dogecoin in the future.

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