Elon Musk Is Sued for Delayed Disclosure of Twitter Stake

Author: Editors Desk Source: WSJ:

April 13, 2022 at 21:21

Elon Musk disclosed a 9.2% stake in Twitter last week, making him the company’s largest shareholder. PHOTO: SUSAN WALSH/ASSOCIATED PRESS

Lawsuit alleges billionaire saved $143 million by delaying the filing, while hurting shareholders who sold stock before his position was publicized

A Twitter Inc. shareholder sued Elon Musk, alleging the billionaire committed securities fraud by delaying the disclosure of his stake in the social-media company.

In the lawsuit, filed in the U.S. District Court for the Southern District of New York on Tuesday, Marc Bain Rasellaalleges that Mr. Musk didn’t properly disclose his Twitter stake within the required time frame. The suit alleges that the move personally benefited Mr. Musk and could have hurt other shareholders who sold the stock.

Mr. Musk, chief executive of Tesla Inc., on April 4 disclosed owning almost 73.5 million shares of Twitter as of March 14. That gave him a 9.2% stake, making him the company’s largest shareholder. Tesla and a representative for Mr. Musk didn’t immediately respond to requests for comment.

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