A Tesla investor is accusing Elon Musk of insider trading after he sold $7.5 billion worth of Tesla stock in late 2022 to fund his acquisition of Twitter.
Per Forbes, the Tesla investor Michael Perry alleges that Musk exploited his position in the company and breached his fiduciary duty to Tesla. Both Musk and the Tesla board are named as defendants in the suit.
The lawsuit points to Musk’s November 2022 and December 2022 stock sales, which were ahead of the news that Tesla would fall short on Q4 deliveries.
Via the court documents, the closing price of shares on the day of the Q4 results was $108.10. Musk would have lost 55% of the value if he had waited to sell after the announcement.
Instead, it is estimated that Musk made around $3 billion in profit from the $7.53 billion stock sale.
According to Bloomberg, Perry and his legal team are asking a judge to force Musk to return the profit he made back to the company.
The lawsuit was filed in Delaware Chancery Court and has been assigned to the same Judge, Judge Kathaleen St. J. McCormick, which oversaw Musk’s unsuccessful attempt to back out of the Twitter deal.
A hearing date has not been set.
Neither legal team has commented on the allegations.
