Elon Musk Sued by Twitter Shareholders Over Late Disclosure of Stock Purchases
variety.comWilliam Earl Elon Musk is facing a federal lawsuit from a group of Twitter shareholders who claim the Tesla founder failed to properly disclose his purchases of the social media giant’s stock.The suit filed Tuesday in U.S.
Southern District of New York asserts that Musk was 10 days late in filing his legally mandated disclosure form after amassing more than 5% of Twitter shares with a buying binge that started in January.The suit, filed by Marc Bain Rasella, asserts that Musk had reached the 5% disclosure threshhold by March 24 but he didn’t file the proper paperwork until April 4.
After the news hit, Twitter shares shot up 27%.The suit maintains that shareholders, including Rasella, who sold stock in the May 24-April 1 period were shortchanged because they were unaware of Musk’s activity.
Meanwhile, the lack of disclosure helped keep the price down while Musk bought more shares, the suit alleges. Twitter’s closing price on April 1 was $39.31.
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