© Reuters. FILE PHOTO: Tesla CEO Elon Musk attends the Tesla Shanghai Gigafactory groundbreaking ceremony in Shanghai, China January 7, 2019. REUTERS/Aly Music/
By Jonathan Stempel
NEW YORK (Reuters) – Elon Musk was sued for $258 billion on Thursday by a investor who accused him of working a pyramid scheme to help the cryptocurrency.
In a grievance filed in federal courtroom in Manhattan, plaintiff Keith Johnson accused Musk, electrical automobile firm Tesla (NASDAQ:) Inc and house tourism firm SpaceX of racketeering for touting Dogecoin and driving up its worth, solely to then let the worth tumble.
Musk is CEO of each Tesla and SpaceX.
“Defendants have been conscious since 2019 that Dogecoin had no worth but promoted Dogecoin to revenue from its buying and selling,” the grievance stated. “Musk used his pedestal as World’s Richest man to function and manipulate the Dogecoin Pyramid Scheme for revenue, publicity and amusement.”
The grievance additionally aggregates feedback from Warren Buffett, Invoice Gates and others questioning the worth of cryptocurrency.
Tesla, SpaceX and a lawyer for Musk didn’t instantly reply to requests for remark.
A lawyer for Johnson didn’t instantly reply to requests for touch upon what particular proof his shopper has or expects to have that proves Dogecoin is nugatory and the defendants ran a pyramid scheme.
Johnson is in search of $86 billion in damages, representing the decline in Dogecoin’s market worth since Could 2021, and needs it tripled.
He additionally needs to dam Musk and his corporations from selling Dogecoin and a decide to declare that buying and selling Dogecoin is playing underneath federal and New York regulation.
The grievance stated Dogecoin’s selloff started across the time Musk hosted the NBC present “Saturday Night time Stay and, taking part in a fictitious monetary knowledgeable on a “Weekend Replace” phase, referred to as Dogecoin “a hustle.”
Tesla in February 2021 stated it had purchased $1.5 billion of bitcoin and for a short while accepted it as cost for autos.
Dogecoin traded at about 5.8 cents on Thursday, down from its Could 2021 peak of about 74 cents.
The case is Johnson v. Musk et al, U.S. District Courtroom, Southern District of New York, No. 22-05037.