Tech billionaire Elon Musk on Friday asked a US court to dismiss a $258 billion racketeering lawsuit accusing him of running a pyramid scheme to support the cryptocurrency Dogecoin.
Lawyers for Musk and his electric car company Tesla Inc filed an evening filing in Manhattan federal court, calling the lawsuit by Dogecoin investors a “fanciful work of fiction” based on Musk’s “innocuous and often silly tweets” about Dogecoin.
According to the lawyers, the investors never explained how Musk intended to defraud anyone or what risks he concealed, and his statements like “Dogecoin Rulz” and “no highs, no lows, only Doge” were too ambiguous to support a fraud claim.
“There is nothing unlawful about tweeting words of support for, or funny pictures about, a legitimate cryptocurrency that continues to hold a market cap of nearly $10 billion,” Musk’s lawyers said.
Investors accused Musk, the world’s second-richest person, of deliberately driving up the price of Dogecoin by more than 36,000% over two years and then allowing it to crash.
They claimed that this resulted in billions of dollars of profit at the expense of other Dogecoin investors, despite Musk’s knowledge that the currency lacked intrinsic value.
The $258 billion in damages is three times the estimated decline in Dogecoin’s market value in the 13 months preceding the lawsuit’s filing.
The suit is Johnson et al v. Musk et al, at the U.S. District Court, Southern District of New York.