After the temporary suspension of Elon Musk’s Twitter acquisitions, it looks like there will be a long war before things calm down.
The billionaire’s purchase may have faced a snag as investors took court action.
Lawsuit Filed Against Elon Musk
According to Reuters, Elon Musk was sued by Twitter investors for the delayed announcement of his shares in the company. The lawsuit was filed in a complaint filed in California federal court Wednesday.
The main claim is that Musk earned $ 156 million by not revealing his total stake on Twitter as of March 14.
Investors claim that to date, Musk has acquired more than 5% of Twitter.
Musk stops buying Twitter cryptocurrency made its impact on the market.
“Market Manipulation”
Plaintiff investors alleged that the billionaire resorted to market manipulation by buying Twitter shares at an ‘artificial low price’.
The investor group, represented by William Heresniak in Virginia, debated Musk’s Twitter purchase:
“Musk continued to buy shares after that date, eventually revealing in early April that he owns 9.2% of the company. By delaying announcing his shares in Twitter, Musk manipulated the market and bought Twitter shares at an artificially low price.”
This development came shortly after the news that Musk had temporarily suspended the Twitter deal.
A confusion about the number of spam and fake accounts on the social media platform was cited as the reason why Elon Musk stopped buying the company.
Neither Musk nor his lawyers have yet responded to requests for clarification. Twitter has also declined to comment for now.
*Not investment advice.