The $258 billion racketeering lawsuit accusing Tesla CEO Elon Musk of running a pyramid scheme to support the crypto Dogecoin has grown, adding some seven new investor plaintiffs and six new defendants which includes his tunnel construction business Boring Co.
Based on an amended complaint filed on September 6 night in Manhattan federal court, Musk, his space tourism company SpaceX, electric car company Tesla Inc, Boring, and others knowingly drove up the price of DOGE over 36,000% over two years and then allowed it to crash.
By doing that, the defendants “profited tens of billions of dollars” at other Dogecoin investors‘ expense. They did that while knowing all along that the digital currency lacked intrinsic value and that its value “depended solely on marketing,” as highlighted by the complaint.
SpaceX, Tesla, and Boring did not instantly respond on September 7 to requests for comment. Tesla disbanded its media relations department in 2021. The original lawsuit was filed in June.
Moments later, Musk, the world’s richest person, tweeted that he would “keep supporting Dogecoin,” and in an interview stated that “people that work around the factory at SpaceX or Tesla” asked him for the support, according to the amended complaint.
The other new defendants include the Dogecoin Foundation, which refers to itself as nonprofit offering governance and support for Dogecoin. It could not instantly be reached for comment. The $258 billion in damages is triple the estimated drop in Dogecoin’s market value since May 2021.
That was about the time Musk, playing a fictitious financial expert on a “Weekend Update” segment of NBC’s “Saturday Night Live,” referred to Dogecoin as “a hustle.” Dogecoin traded at around 6 cents on September 7, down from about 74 cents in May 2021.
This case is Johnson et al v. Musk et al, United States District Court, Southern District of New York, No 22-05037.
