Attorneys representing Tesla CEO Elon Musk are calling for a judge to dismiss a multi-billion dollar case accusing the celebrity entrepreneur of insider trading with Dogecoin (DOGE) against his online followers.
The lawyers say the accusations should be dismissed with prejudice, barring plaintiffs from continuing to burden the judicial system with additional accusations based on Musk’s Twitter activity.
In a letter filed in a New York federal court on Monday, Musk’s lawyer Alex Shapiro blasted the disgruntled investors repeated plea attempts as “baseless” and “frivolous.”
The lawsuit, he explained, is “based on nothing more than Mr. Musk’s innocuous and
often silly tweets” about DOGE. “There is nothing unlawful about tweeting words of support for, or funny pictures about, a cryptocurrency that holds a market capitalization of over $11 billion,” it read.
The plaintiffs’ initial complaint filed in June 2022 sought $258 billion from Musk to make up for investor losses incurred by his promotion of DOGE in early 2021. The lawsuit has since been amended three times, with lead attorney Evan Spencer adding insider trading and market manipulation charges to the lawsuit by June 2023.
The latter filing identified specific wallets that Musk allegedly traded DOGE from while affecting the asset’s price via his tweets. His lawyers said plaintiffs lacked proof that any of the identified wallets actually belonged to the CEO.
“Plaintiffs fail to state a claim that Mr. Musk’s cheerleading for Dogecoin – quintessential inactionable puffery – was materially false or misleading, or that Defendants acted with the requisite intent,” it added.
“Puffery” means a vague and exaggerated statement to which a reasonable person cannot ascribe an exact meaning or intent.
Some of Musk’s alleged “falsehoods” which his defendants say were mere puffery include tweets reading “Dogecoin to the moooonn,” and “Dogecoin will live forever.”
Plaintiffs and defendants agreed that Dogecoin is a “highly speculative security investment,” but the latter asserted that this fact was “public, widely known, and obvious,” noting that Dogecoin founder Billy Markus has himself admitted this.
Furthermore, plaintiffs’ insider trading accusation “fails on its face,” according to Spencer, since Elon’s private intentions about what to tweet about Dogecoin are “not material non-public information about Dogecoin.”
“Plaintiffs have had the opportunity to file four complaints in this case and their allegations continue to fall well short of pleading any cause of action, let alone a sufficiently particularized complaint,” wrote Musk’s lawyers.