A California jury has found that billionaire Elon Musk misled Twitter investors before concluding a deal to buy the company for $44 billion. Musk testified that he did not believe his posts could cause panic in the markets.
A California jury has found that billionaire Elon Musk misled Twitter investors before concluding a deal to buy the company for $44 billion. Musk testified that he did not believe his posts could cause panic in the markets.
«If this trial were about whether I wrote stupid tweets, I would plead guilty,» Elon Musk noted.
CNBC reports that Musk’s lawyers will likely file an appeal, as the damages could reach $2.6 billion.
While the jury found that Musk did not engage in a specific scheme to defraud shareholders, they found two tweets by Musk, posted on May 13 and 27, 2022, to be materially false or misleading, leading some investors to sell Twitter shares at a price below the offer price.
«The agreement with Twitter is temporarily suspended pending detailed information confirming that the number of spam accounts and fake profiles is indeed less than 5% of the total number of users,» Elon Musk wrote on May 13, 2022.
«20% fake/spam accounts is 4 times more than Twitter claims, but in reality this figure could be *much* higher.
My proposal was based on the assumption that Twitter’s data filed with the Securities and Exchange Commission (SEC) was accurate.
Yesterday, Twitter’s CEO publicly refused to provide evidence that this figure is less than 5%.
«This deal cannot be concluded until he does so,» the billionaire said on May 27, 2022.
Elon Musk’s tweets and additional comments caused Twitter shares to fall nearly 10% in one session, and he completed the purchase of Twitter for $54.20 per share. He later renamed the company X and then merged it with his artificial intelligence company xAI and then SpaceX, which makes reusable space rockets.
«This is a great example of what not to do to the average investor — people who have retirement savings, children, pension funds, are teachers, firefighters, nurses,» said Joseph Cotchett, a lawyer for Twitter investors.
Earlier, the European Commission imposed its first fine under the Digital Services Act (DSA) — it was directed against Elon Musk’s company X (Twitter). This decision was very much disliked by the administration of US President Donald Trump and Musk himself. After that, X (Twitter) disabled the European Commission’s advertising account and accused officials of abusing the platform’s tools.
