An institutional shareholder complaint filed Tuesday accuses Elon Musk of earning billions by selling Tesla stock using insider knowledge.
The Employees' Retirement System of Rhode Island (ERSRI) wants the Tesla CEO to refund "unlawful profits," according to Reuters. The complaint was filed two days before Tesla shareholders' crucial vote on whether to reinstate Musk's $56 billion compensation package, which a Delaware judge annulled in January due to the tech billionaire's inappropriate control.
Elon Musk Allegedly Used Profits to Buy Twitter
The complaint claims that Musk and his brother, Tesla director Kimbal Musk, sold $30 billion in Tesla stock between late 2021 and 2022, before news that would lower the stock. According to the ERSRI, Elon Musk sold the shares at inflated rates by concealing his plan to purchase Twitter, which he eventually renamed X.
According to the lawsuit, Musk traded Tesla shares after learning that Tesla car deliveries were substantially below expectations. Elon Musk has not responded to the allegation as of present reporting.
ERSRI, which owns 140,000 Tesla shares worth $24 million, is not the only shareholder to sue. Mike Perry, another Tesla stakeholder, accused Musk of insider trading last month for selling over $7.5 billion in Tesla shares in late 2022.
Investigators are also looking into Musk for breaking federal securities laws in 2022 by purchasing Twitter shares.
ERSRI accuses Musk of directing Tesla staff to X and forcing Tesla to pay for Twitter advertising after he owned the platform. Insufficient oversight of Musk's conflicts of interest by Tesla's board of directors worried the fund's general treasurer.
The complaint also claims Elon Musk encouraged xAI, where he serves as CEO, to hire Tesla personnel and redirect Tesla AI chips to the X messaging platform and xAI. This raises fears that Musk is favoring AI development outside Tesla.
Elon Musk posted on X that Tesla has no location to store and activate Nvidia AI chips.
Elon Musk Had Sexual Relationship with Former Employee: Report
In another controversy, a former SpaceX intern claims to have had a brief sexual connection with Elon Musk.
According to a report from Business Insider, Elon Musk met the lady in the early 2010s during her undergraduate work at SpaceX. She told pals that she contacted Musk with company-improvement suggestions, which led to a "Star Wars" date and kiss.
The report, citing an article from Wall Street Journal, stated that Musk flew the lady to Sicily to meet him at a resort, citing records. In 2017, Musk personally approached the lady for an executive position. According to her lawyers, she departed from SpaceX in 2019.
In affidavits submitted by the woman's attorneys, she denied dating Musk while working at SpaceX from 2017 to 2019. The woman noted that Elon Musk did not commit any "predatory or wrongful" act towards her during her employment at the firm.
The attorneys, who also represent Musk, acknowledged her past romance with the SpaceX CEO. Individuals who know the issue said she visited Musk at his house many times while working at SpaceX.
The report did not name the woman, but she and Musk's attorneys submitted letters seeking the removal of the article.
In recent years, SpaceX has faced criticism for sexual harassment.
These developments come after Elon Musk dropped his lawsuit against OpenAI and CEO Sam Altman, previously reported by TechTimes.
The complaint accused the ChatGPT maker of breaking its contract and abandoning its purpose to improve mankind via AI technology.
The tech mogul filed a case in California state court in February. The withdrawal occurs one day before the judge assesses OpenAI's case dismissal motion.
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