Tesla founder Elon Musk has been sued by former Twitter shareholders who claim he did not disclose his stake in the tech company in a timely fashion causing them to lose out on profits from the social media platform’s rise in stock.
Plaintiff and stockholder Marc Bain Rasella filed a class-action lawsuit against Musk on behalf of all Twitter shareholders who held stock between the day Musk passed the five percent ownership threshold on March 24, and April 1.
The lawsuit claims that Musk was required to file his stake with the Securities and Exchange Commission within 10 days after passing the 5 percent ownership threshold but that he failed to do so until April 4.
Twitter shares rose 27 percent from April 1 to April 4, when Musk announced his stake in Twitter, and individuals who bought out of the stock missed out on the share price increase, the lawsuit argues.
“The members of the class [action lawsuit] are so numerous that joinder of all members is impracticable,” Rasella said in the suit.