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Investor claims that Musk ignored US disclosure rules in Twitter stock buy

May, 31, 2024 Hi-network.com

According to a lawsuit filed by a Twitter investor, Elon Musk faces allegations of ignoring US securities disclosure rules while secretly accumulating shares in Twitter in 2022. The lawsuit claims Musk and his associate Jared Birchall were aware of the requirement to disclose any stake over 5% but chose to delay this disclosure to buy shares at lower prices. That delay, according to the Oklahoma firefighters' pension fund, saved Musk over$200 million, harming other investors.

Musk and Birchall worked with a Morgan Stanley executive to craft a covert strategy to acquire Twitter shares without triggering the disclosure obligation. The executive repeatedly advised Birchall to seek legal counsel regarding the disclosure rule, but Birchall falsely assured him that lawyers had been consulted. By the time they disclosed Musk's stake, it had surpassed 9%, significantly more than the 5% threshold.

The lawsuit underscores Musk's pattern of flouting US federal securities laws, citing his history with the US Securities and Exchange Commission (SEC), including a 2018 incident where he prematurely tweeted about taking Tesla private. Musk's legal team has defended him, stating that any failure to disclose was unintentional due to his busy schedule. Despite this defence, the lawsuit portrays Musk's actions as part of a broader disregard for regulatory requirements.

tag-icon Tags quentes : Legislação e regulamentação Económico

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