On Friday, Elon Musk requested a U.S. judge to dismiss a $258 billion racketeering lawsuit alleging that he operated a pyramid scheme to promote the cryptocurrency Dogecoin.
Lawyers for Elon Musk and Tesla Inc filed a document in Manhattan federal court on Friday evening, stating that the $258 billion lawsuit brought by Dogecoin investors is a “fanciful work of fiction” and claiming that Musk’s tweets about Dogecoin were “innocuous and often silly.”
According to Musk and Tesla’s lawyers, the investors who filed the lawsuit did not provide any explanation of how Musk was planning to defraud anyone or what risks he was hiding. They further argued that Musk’s statements about Dogecoin such as “Dogecoin Rulz” and “no highs, no lows, only Doge” were too general to constitute a fraud allegation.
Musk’s legal team argued that there was nothing illegal about expressing support for a legitimate cryptocurrency and that the plaintiffs failed to provide evidence of any wrongdoing. They also called for the dismissal of the lawsuit, stating that the plaintiffs’ claims were unfounded and should be put to an end by the court.
The lawyers also rejected the investors’ claim that Dogecoin should be considered a security, in a footnote. In an email, the investors’ lawyer, Evan Spencer, expressed confidence in the success of their case: “We are more confident than ever that our case will be successful.”
According to investors, Elon Musk, the second-richest person in the world according to Forbes, intentionally caused the price of Dogecoin to soar by more than 36,000% over two years and then allowed it to crash, resulting in billions of dollars in profits at the expense of other Dogecoin investors. The investors claimed that Musk was aware that the currency had no intrinsic value.
Investors cited Musk’s portrayal of a fictitious financial expert on a “Weekend Update” segment of NBC’s “Saturday Night Live,” where he called Dogecoin “a hustle.” The investors are seeking $258 billion in damages, which is three times the estimated drop in Dogecoin’s market value in the 13 months prior to the lawsuit’s filing.
The Dogecoin Foundation, a nonprofit organization, is also named as a defendant and is seeking the dismissal of the lawsuit. Meanwhile, several lawsuits have been filed against Musk in response to his posts on Twitter, which he owns.
On February 3, Elon Musk won a court case in San Francisco where a jury found him not guilty of tweeting in August 2018 that he had secured funding to take Tesla private.