Elon Musk’s $258 billion dogecoin fraud case dismissed

Tesla Inc. CEO Elon Musk has denied a high-profile $258 billion lawsuit accusing him and his company of rigging the value of Dogecoin (DOGE), a popular meme-based cryptocurrency.

On Thursday, US District Judge Alvin Hellerstein ruled against Musk and Tesla, dismissing claims by a group of disgruntled investors.

The judge ruled that the tweets were “annoying” and not actionable

A lawsuit filed by Dogecoin holders in June 2022 alleges that Musk and his company used social media and public statements to artificially inflate the token's value only to allow it to later fall, causing them significant financial losses.

The plaintiffs' tweets and public support for the meme coin boosted its value by more than 36,000%.

Judge Hellerstein dismissed the suit, saying the SpaceX CEO's statements were “wishful thinking” and “difficult” rather than actionable claims. The judge also ruled that the statements were not “substantial and susceptible to fraud” and that “no reasonable investor could rely on them” to make investment decisions.

The complainants cited the 53-year-old's tweets as evidence of material misrepresentations, including claims that he would be the “CEO of Dogecoin” and that he could load “live Dogecoin” on a SpaceX rocket. And fly to the moon.

Pump and dump charges

The investors also accused the tech billionaire and electric car company of engaging in a “pump and dump” scheme with Memcoin. But the judge did not give a clear and convincing explanation as to how the two got into such a situation.

Hellerstein said in the decision, “The allegations on which plaintiffs base their conclusion of market manipulation are incomprehensible.”

According to a March 31 Reuters report, Musk's legal team had previously sought to dismiss the case, arguing that the plaintiffs had not shown how he intended to deceive anyone or what kind of danger he was hiding.

They maintained that his tweets, including statements like “Dogecoin Rulz” and “No highs, no lows, only Doge,” were too vague to support claims of fraud.

“There is nothing illegal about tweeting words of support or funny images about a legitimate cryptocurrency that continues to command a market cap of nearly $10 billion,” the lawyers argued.

The court should put an end to the plaintiffs' nightmare and dismiss the complaint, he added.