Elon Musk gestures as he speaks during a press conference at SpaceX's Starbase facility near Boca Chica Village in South Texas on February 10, 2022. - Billionaire entrepreneur Elon Musk delivered an eagerly-awaited update on SpaceX's Starship, a prototype rocket the company is developing for crewed interplanetary exploration. (Photo by JIM WATSON / AFP) (Photo by JIM WATSON/AFP via Getty Images)
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The Reason Elon Musk Is Facing A $258 Billion Lawsuit
A lawsuit claiming damages of $258 billion was filed against Elon Musk, the world's richest man, in Manhattan on June 16, 2022; it’s a staggering sum and more than his current net worth of $212.5 billion. According to Forbes, Musk’s wealth is mostly tied up in Tesla stock, although he also owns a 9.1% interest in Twitter and the $125 billion company SpaceX in his portfolio.
Musk has also been active in the meme-based cryptocurrency Dogecoin, which has been valued at a fraction of a cent for the majority of its history. After Musk’s continuous tweeting and promises to literally take it “to the moon,” Dogecoin reached an all-time high of 64 cents per coin — but now has collapsed below a cent per coin, and one person is placing the blame on Musk.
Keith Johnson, who filed the lawsuit, claims Musk pumped up the price of Dogecoin, using his fame, following, and platform to “operate and manipulate the Dogecoin Pyramid Scheme for profit, exposure, and amusement.” Johnson’s seeking three times the amount Dogecoin has declined in value since its high and also wants the trading of Dogecoin to be seen as gambling.
Despite the accusations, Musk's actions do not seem to fit the definition of a “pyramid scheme,” which Investopedia describes as: “an illegal investment scam based on a hierarchical setup of network marketing.” Still, it’s not the first time Musk’s financial and Twitter activities have landed him in court — most recently and somewhat ironically, Twitter shareholders are suing him.