TWITTER SHAREHOLDER: ELON MUSK JUST STIFFED US AND MADE OFF WITH MILLIONS

R&I ~ MJM

Marc Bain Rasella alleges in a lawsuit against Musk that the billionaire failed to disclose his Twitter stake on time, helping him save a cool $143 million.

Twitter shareholder Marc Bain Rasella sued Elon Musk on Tuesday, accusing the billionaire of failing to disclose his Twitter stake within the time frame required by the U.S. Securities and Exchange Commission (SEC). The move allegedly helped Musk save approximately $143 million in subsequent share purchases, according to the lawsuit. Rasella, who aims to represent all investors who sold their Twitter stock during the week of March 24 to April 1, filed the lawsuit in the U.S. District Court for the Southern District of New York.

The lawsuit argues that by filing his disclosure so late, Musk, the CEO of Tesla and Twitter’s top shareholder, violated a securities law requiring shareholders to alert the SEC within 10 days after they exceed a 5% ownership threshold in a company. Rasella’s suit alleges that Musk’s Twitter investment exceeded 5% by March 14, but he continued to buy up Twitter shares at about $39 per share and failed to disclose his stake until last Monday. At that point, it was revealed that he commanded a 9.2% stake—or 73.5 million shares—in the social media company. On the day Musk disclosed his Twitter stake, the company’s stock price surged by approximately 27%.

Numerous legal and securities experts seem to agree that the overdue filing potentially netted Musk an estimated $156 million, according to The Washington Post. Likewise, Alon Kapen, a corporate lawyer for law firm Farrell Fritz, said in a statement to CNBC that Musk gave himself an “extra 10 days in which to buy additional shares (he increased his ownership during that time by an extra 4.1%) before the per-share-price spike that occurred when he finally announced his holdings on April 4.”

239ArchStreet

Article URL : https://www.vanityfair.com/news/2022/04/twitter-shareholder-elon-musk