Twitter Investors Sue Elon Musk for Failing to Promptly Disclose the Size of His Stake
April 13, 2022
A group of Twitter shareholders are suing Elon Musk for allegedly failing to disclose he had bought a significant stake in the social media company in the right timeframe.
The class action case has been filed on behalf of investors who claim they lost out on potential gains they could have realized had Musk disclosed his shareholding earlier.
“What seems crystal clear is that Elon Musk missed the applicable 10-day filing deadline under Sections 13(d) and 13(g) of the Securities Act of 1933 to report 5% ownership in a public company,” Alon Kapen, a corporate transaction lawyer with Farrell Fritz, said in a statement shared with CNBC.
“That gave him 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,” Kapen added.
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