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Elon Musk $258 billion Dogecoin lawsuit expands

By Jonathan Stempel NEW YORK (Reuters) - The $258 billion racketeering lawsuit accusing Elon Musk of running a pyramid scheme to support the cryptocurrency Dogecoin has expanded,...
Elon Musk $258 billion Dogecoin lawsuit expands © Reuters. FILE PHOTO: A photo of Elon Musk is displayed on a smartphone placed on representations of cryptocurrency Dogecoin in this illustration taken June 16, 2022. REUTERS/Dado Ruvic/Illustration/File Photo

By Jonathan Stempel

NEW YORK (Reuters) - The $258 billion racketeering lawsuit accusing Elon Musk of running a pyramid scheme to support the cryptocurrency Dogecoin has expanded, adding seven new investor plaintiffs and six new defendants including his tunnel construction business Boring Co.

According to an amended complaint filed on Tuesday night in Manhattan federal court, Musk, his electric car company Tesla (NASDAQ:TSLA) Inc, his space tourism company SpaceX, Boring and others intentionally drove up the price of Dogecoin more than 36,000% over two years and then let it crash.

By doing so, the defendants "profited tens of billions of dollars" at other Dogecoin investors' expense, while knowing all along that the currency lacked intrinsic value and that its value "depended solely on marketing," the complaint said.

Tesla, SpaceX and Boring did not immediately respond on Wednesday to requests for comment. Tesla disbanded its media relations department in 2020.

The original lawsuit was filed in June.

Shortly afterward, Musk, the world's richest person, tweeted that he would "keep supporting Dogecoin," and in an interview said "people that work around the factory at SpaceX or Tesla" asked him for that support, the amended complaint said.

Other new defendants include the Dogecoin Foundation, which calls itself a nonprofit providing governance and support for Dogecoin. It could not immediately be reached for comment.

The $258 billion in damages is triple the estimated decline in Dogecoin's market value since May 2021.

That was around the time Musk, playing a fictitious financial expert on a "Weekend Update" segment of NBC's "Saturday Night Live," called Dogecoin "a hustle."

Dogecoin traded at about 6 cents on Wednesday, down from around 74 cents in May 2021.

The case is Johnson et al v. Musk et al, U.S. District Court, Southern District of New York, No. 22-05037.

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01-05-2024 10:45:17 (UTC+7)

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 EUR/USD1.0658↑ Sell
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 USD/CAD1.3780↑ Buy
 EUR/JPY168.32↑ Buy
 EUR/CHF0.9808Neutral
 Gold2,295.80↑ Sell
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 US Coffee C213.73↑ Sell
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 IBEX 3510,854.40Neutral
 BASF49.155↑ Sell
 Bayer27.35↑ Sell
 Allianz266.60↑ Sell
 Adidas226.40↑ Sell
 Lufthansa6.714Neutral
 Siemens AG175.90↑ Sell
 Deutsche Bank AG15.010Neutral
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