Elon Musk misled investors during Twitter takeover, US jury finds
US Jury Rules Elon Musk Deceived Investors in Twitter Acquisition
A U.S. jury determined that Elon Musk intentionally manipulated Twitter’s stock valuation in the months prior to his $44 billion takeover of the social media platform. The verdict centered on claims that the billionaire misled shareholders by downplaying the platform’s value, leading to a drop in its share price.
Partial Clearance on Fraud Allegations
Although Musk faced accusations of deception, he was exonerated from certain fraud charges in the San Francisco-based civil trial. The case was initiated by a class-action lawsuit filed shortly before his acquisition, which he later rebranded as X.
Key Testimony and Legal Arguments
Jurors assessed whether Musk’s May 2022 statements, including tweets and remarks on a podcast, amounted to deliberate misinformation. These comments included his assertion that the bot percentage on Twitter was below 5%, a claim he said was critical to proceeding with the deal.
“He trashed the company. Trashed the executives. And tanked the stock,” stated Mark Molumphy, the shareholders’ lawyer, during his closing argument.
Musk’s legal team contended that his concerns about bots were genuine, emphasizing that highlighting the issue did not equate to fraudulent intent. They argued that the platform’s misrepresentation of bot activity justified his decision to renegotiate the terms of the purchase.
Financial Implications and Settlement Talks
The exact financial penalty remains uncertain, though it could reach billions of dollars. Thousands of shareholders, many institutional investors, may be entitled to compensation. Musk’s net worth, currently valued at approximately $814 billion, is heavily invested in Tesla stock.
Following Musk’s attempt to withdraw from the deal, Twitter pursued legal action to enforce the original agreement. After negotiations, Musk ultimately completed the acquisition in October 2022. He is also in separate discussions to settle an SEC lawsuit, which alleges he delayed disclosing his initial stake in Twitter to secure lower prices before publicizing his intent to buy the company.
Additional Coverage and Context
Meanwhile, recent headlines highlighted Trump’s rise as a new billionaire, Musk’s Starlink satellites linked to the UK’s mobile network, and Grok’s controversial posts about football-related tragedies. These developments underscore the broader impact of Musk’s ventures beyond the Twitter takeover.