A Tesla shareholder, Michael Perry, filed a lawsuit on Thursday accusing CEO Elon Musk of insider trading, alleging Musk sold over $7.5 billion in Tesla shares in late 2022 before potentially disappointing production and delivery numbers were made public. Perry claims Musk “improperly benefited” by about $3 billion in insider profits.
“Musk exploited his position at Tesla, and he breached his fiduciary duties to Tesla,” the lawsuit stated, asking the court to direct Musk to return the profits.
The lawsuit, filed in Delaware Chancery Court, also accuses Tesla’s directors of breaching their fiduciary duty by allowing Musk to sell the shares. Musk and Tesla did not immediately respond to a request for comment.
Perry alleges that Elon Musk, who claimed in 2022 that demand for Tesla vehicles was “excellent,” learned of lower-than-expected numbers in mid-November and sold his shares before this information was public. Tesla’s stock plummeted after the release of the fourth-quarter numbers in January.
The lawsuit adds to Musk’s legal challenges, including a pending vote on his $56 billion pay package and a regulatory probe over his 2022 purchase of Twitter stock. Musk and the SEC have a long-standing feud dating back to 2018 over his “funding secured” tweet.
