NEW YORK, March 31 (Reuters) – A federal judge on Tuesday said former Twitter investors who accused Elon Musk of defrauding them by waiting too long to disclose his initial investment in the social media company may pursue their case as a class action.
The decision by U.S. District Judge Andrew Carter in Manhattan exposes the world’s richest person to potentially greater damages than if investors were forced to sue individually.
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Lawyers for Musk did not immediately respond to requests for comment. Musk bought Twitter for $44 billion in October 2022 and renamed it X.
Investors led by the Oklahoma Firefighters Pension and Retirement System said Musk ignored a March 24, 2022 deadline set by U.S. Securities and Exchange Commission rules to reveal he owned 5% of Twitter shares, and waited 11 more days before disclosing a 9.2% stake.
The investors said Musk saved more than $200 million, and cheated them because they sold Twitter shares at depressed prices during the 11-day period.
Investors said they relied on two March 26, 2022, tweets, where Musk said he was
Elon Musk must face class action over late disclosure of Twitter stake, judge rules
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