Billionaire investor Elon Musk is facing a $7.5B insider trading lawsuit from a Tesla (NASDAQ:TSLA) shareholder, according to legal documents filed in a Delaware court on Thursday.
Tech investor Michael Perry filed the lawsuit alleging that Musk, the CEO of the electric carmaker, sold over $7.5B of company stock in 2022 before its Q4 results were made public on January 2, 2023, disappointing shareholders.
Musk “improperly benefited” by $3B in profits from the alleged sales that took place in November 2022 and December 2022, Perry argued in his lawsuit filed in Delaware Chancery Court.
“Musk exploited his position at Tesla, and he breached his fiduciary duties,” to the company and its shareholders, he added.
In his lawsuit, Perry also accused Tesla (TSLA) directors of failing to fulfill their fiduciary duty by allowing Musk to proceed with the share sales.
The lawsuit asks Judge Kathaleen St. J. McCormick to direct Musk to return the profits made from the alleged trades.