Twitter shareholders are suing Billionaire Elon Musk over claims he manipulated the company’s stock price downward, which has contribute to to volatile price swings in the company’s stock price.
According Reuters, the investors said Musk saved himself $156 million by failing to disclose that he had purchased more than 5% of Twitter by March 14.
Twitter’s share price has dropped, since Musk’s acquisition to more than 12%, and Tesla’s is down about 28% as part of a broad sell-off in tech stocks.
Tesla shares were off more than 40% at the end of trading Wednesday since Musk first revealed his stake.
The group of investors, represented by William Heresniak from Virginia, argued about Musk Twitter purchase,
“Musk continued to buy stock after that, and ultimately disclosed in early April that he owned 9.2% of the company. By delaying his disclosure of his stake in Twitter, Musk engaged in market manipulation and bought Twitter stock at an artificially low price,” said the investors, led by Virginia resident William Heresniak.
This comes after Musk’s recent decision to temporarily halt the Twitter deal. The halt was about confirming details of calculating the share of spam and fake accounts of all the Twitter accounts.
On Wednesday, Twitter shareholders allege that Musk violated California corporate laws on several fronts, and in doing so engaged in market manipulation.
Twitter co-founder Jack Dorsey stepped down, on Wednesday, from his role as one of Twitter’s board of directors.
Musk on Wednesday pledged an additional $6.25 billion in equity financing to fund his bid for Twitter, a sign he is still working to complete the deal.
[ADDITIONAL NEWS SOURCE : REUTERS & OTHER NEWS AGENCIES]