Billionaire and Tesla boss Elon Musk has been vocal about his support for Dogecoin for a long time. The SpaceX CEO has also put the meme coin ahead of other digital assets such as Bitcoin in the past. However, in a recent update, Elon Musk’s support for Dogecoin will cost him so much after being slammed with a lawsuit of over $258 billion. According to the filing details, the Tesla boss and his company have been involved in a pyramid scheme involving the digital asset.
Dogecoin has been labelled a fraudulent scheme by one Keith Johnson, who sued Elon Musk, and his two companies, Tesla and SpaceX, for promoting the cryptocurrency as an investable security to the public.
Johnson filed a class action lawsuit of $258 billion against the world’s richest man, saying that he and other investors in Dogecoin have lost about $86 billion to the cryptocurrency which has slumped -91.8% between May 2021, when it hit a high of 74 cents to Thursday, selling at six cents.
According to court documents, Johnson is seeking damages in two forms, first is compensation of $86 billion, as well as $172 billion due to losses incurred on the investment by him and fellow investors.
In the papers submitted to the court, he said Dogecoin is nothing but a pyramid scheme that shouldn’t be promoted as an investable asset, stating that the cryptocurrency doesn’t pay interest or dividends.
He explained that the cryptoasset is neither backed by gold or any valuable metal. Johnson asked the court to stop Musk from further promoting Dogecoin, and to declare the cryptocurrency as a gamble under the New York law, and the United States.
This would not be the first time the billionaire or any of his companies would be facing a lawsuit. At least 160 lawsuits have been filed against Tesla alone. The billionaire faces lawsuit which includes his tweets. He has also been sued by Tesla shareholders in the Solar city case. Two former Tesla security employees, Karl Hansen and Sean Gouthro filed whistleblower complaints via the law firm Meissner Associates to the SEC. They claimed, among other things, that Tesla spied on workers, and covered up theft and narcotics trafficking at its battery plant in Sparks, Nevada. Also a former employee, Marcus Vaughn, pursued a class-action lawsuit against Tesla in California alleging that the company ignored black employees’ reports of rampant racism. The National Labor Relations Board filed a complaint in August 2018 accusing Musk of violating labour laws with a tweet on May 20 that employees wouldn’t have stock options if they formed a union. Musk was sued by spelunker Verne Unsworth, whom Musk claimed without evidence was a paedophile and child rapist. In addition, there are also at least 43 workers’ rights cases, 14 deposit theft cases, and 20 vendor and government non-payment cases filed against Tesla since it went public in 2010.
