Twitter investors have sued billionaire Elon Musk, accusing him of manipulating the company's share price downwards by delaying disclosure of his investment in the firm.
In their court rulings, the shareholders claimed that Elon Musk saved $156m by failing to report that he had purchased more than 5% of Twitter before March 14.
According to the lawsuit, filed on Wednesday, local time in San Francisco Federal Court, Musk continued to buy stock after that and eventually announced in early April that he held 9.2% of the company.
"By delaying the disclosure of his Twitter interest, Musk participated in market manipulation and purchased Twitter stock at an artificially low price," said the investors, led by Virginia resident William Heresniak.
Elon Musk puts Twitter deal on hold over spam accounts
The investors also believe Musk's public criticism of the company, such as a May 13 tweet indicating that the takeover was "temporarily on hold" until Twitter showed that spam bots accounted for less than 5% of its users, was an attempt to push the stock price further lower.
Neither Twitter, Musk nor his lawyer immediately responded to requests for comment.
On Thursday afternoon, Tesla's stock was trading at roughly $713, down from over $1,000 in early April.
The Wall Street Journal reported earlier this month that the timing of Musk's stake disclosure had already prompted an investigation by the US Securities and Exchange Commission (SEC).
The SEC requires any investor who buys more than 5% of a company's stock to report their holdings within 10 days of passing the threshold.
The investors requested that they be recognised as a class and that an unspecified amount of damages be awarded to them.
Investment Week has reached out to Musk and Twitter for comment.
