- Tesla investor accuses Elon Musk, the CEO of Tesla, of $7.5 billion of inside trading in November and December 2022.
- Musk allegedly profited about $3 billion from the sales, according to the lawsuit and would earn less than 55% of it if he waited to make the selloff after the public announcement of the delivery miss.
- Michael Perry, who filed the lawsuit, has asked a judge for Musk to return the profit he made from the alleged insider trading.
Elon Musk, the world’s wealthiest man, has been accused of selling over $7.5 billion worth of Tesla stock in late 2022, according to a lawsuit filed by a Tesla shareholder Thursday. The shareholder also accused Musk of exploiting his position and breaching fiduciary duties.
The alleged insider trading
Elon Musk was sued for selling approximately $7,530,113,926 of company stock in 2022 with non-public information about Tesla falling short on fourth-quarter deliveries and production. If 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 realised, the lawsuit said.
Also read: Musk faces lawsuit over delayed disclosure of Twitter stake
Also read: CalPERS CEO opposes Musk’s $56B pay package at Tesla
Key background
In 2022, Musk sold 19.5 million Tesla shares worth about $3.95 billion shortly after his $44 billion purchase of Twitter. The tech billionaire sold a total of about $22.9 billion worth of shares later that year, according to CNBC, which cited financial research firm VerityData.
In 2023, he followed up with another large selloff in December, selling around $3.6 billion worth of his company’s stock. 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.
