Elon Musk and Tesla Beat Lawsuit Accusing Them of Defrauding Dogecoin Investors

The class-action lawsuit alleged that Musk had posted statements on Twitter, now X, “that Dogecoin is the people’s crypto and the future currency of Earth”

A federal judge in Manhattan has dismissed a lawsuit that accused Elon Musk and Tesla of defrauding investors by pumping up and then dumping the Dogecoin cryptocurrency, causing investor losses.

The plaintiffs had sought $258 billion in damages, alleging that Musk drove up Dogecoin’s price by more than 36,000% with his statements and then let it crash.

The class-action lawsuit pointed to several statements Musk made, including posting on Twitter, now X, that Dogecoin is the people’s crypto and the future currency of Earth, that Dogecoin might become the standard for the global financial system and the currency of the internet, and that Musk had agreed to become Dogecoin’s CEO, among others.

However, US District Judge Alvin Hellerstein permanently dismissed the case on Thursday night, writing in his decision that these statements are aspirational and puffery, not factual and susceptible to being falsified.

“No reasonable investor could rely upon them.”

The judge also noted that it is not possible to understand the allegations that form the basis of Plaintiffs’ conclusion of market manipulation.

The lawsuit was filed in June 2022, and the plaintiffs included people who said they lost money on Dogecoin after investing between 2021 and 2022.

The plaintiffs had sought to recoup their losses and have Musk and Tesla pay triple damages, which would have amounted to $754 billion.

The plaintiffs also sought to have Musk and Tesla banned from promoting Dogecoin and to have a fund established to compensate defrauded investors.

Dogecoin soared more than 70% when Musk finalised his acquisition of Twitter, now X, in October 2022.

More recently, changing the X logo to a picture of Kabosu, the shiba dog in the Dogecoin logo, drove up the cryptocurrency’s price by more than 30% in April 2023.

However, it seems that times may be changing.

Last week, when Musk promoted Dogecoin with a joking reference on X to heading a “Department of Government Efficiency,” or D.O.G.E for short, the coin’s price rose only about 5%.

Dogecoin was up 0.06% today at $0.1012.

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