Tesla chief Elon Musk was accused of selling more than $7.5 billion worth of Tesla stock in late 2022 as part of an insider trading move, according to a lawsuit filed by a Tesla shareholder Thursday, who accused Musk of exploiting his position and breaching fiduciary duties.
The lawsuit, filed by Tesla investor Michael Perry, alleges Musk had nonpublic information about Tesla falling short on fourth-quarter deliveries and production when he sold approximately $7,530,113,926 of company stock in November and December 2022.
Had Musk waited to make the selloff after the public announcement of the delivery miss, the sales would have netted him less than 55% of what he actually realized, the lawsuit said.
Musk allegedly profited about $3 billion from the November and December sales, according to the lawsuit, which cited Tesla’s Jan. 3, 2023, closing price of $108.10 per share.
Bloomberg, which first reported the lawsuit, noted Perry has asked a judge for Musk to return the profit he made from the alleged insider trading.
Tesla and Musk’s lawyer did not immediately respond to Forbes’ request for comment.
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We estimate Musk’s net worth at $209 billion, making him the wealthiest person in the world. The Tesla chief reclaimed the No. 1 spot from LVMH head Bernard Arnault this week after announcing his artificial intelligence startup xAI raised $6 billion in a series B funding round.
Musk sold 19.5 million Tesla shares worth about $3.95 billion in November 2022 not long after closing his $44 billion purchase for Twitter. He followed up with another large selloff in December, selling around $3.6 billion worth of his company’s stock. The tech billionaire, who said earlier that year he had “No further TSLA sales planned after today,” sold a total of about $22.9 billion worth of shares in 2022 after agreeing to buy Twitter, according to CNBC, which cited financial research firm VerityData. Perry’s suit is the latest dig into Musk’s stock activity. A federal investigation into his purchase of Twitter is in full swing, with Musk agreeing this week to testify in the Securities and Exchange Commission’s probe into the $44 billion acquisition. Musk was sued by regulators last year for allegedly refusing to testify about the purchase.
Elon Musk Will Testify In Federal Investigation Of Twitter Purchase—After Feds Sued Him (Forbes)
SEC Sues Elon Musk For Refusing To Testify About Twitter Purchase (Forbes)
