A federal jury in California determined on Friday that tech billionaire Elon Musk provided false information to Twitter shareholders, contributing to a decline in the company’s stock price as he prepared to acquire it in a $44 billion transaction.
The verdict, issued in a class-action securities case, could require Musk, the world’s wealthiest individual, to pay billions, based on damages calculated by the jurors.
Shortly after the decision, Musk’s attorneys informed AFP that he intends to appeal, describing the ruling as a “setback.”
The case followed a three-week trial in a San Francisco federal court, which included in-person testimony from Musk.
The jury concluded that two tweets Musk posted in May 2022 contained false statements that directly caused a drop in Twitter’s share value.
The lawsuit, filed by investor Giuseppe Pampena, represented shareholders who sold Twitter stock between mid-May and early October 2022. Musk completed the acquisition of the social media company in late October 2022, later rebranding it as X.
Jurors agreed that Musk breached securities regulations prohibiting false or misleading statements that negatively impact stock prices. The plaintiffs’ legal team estimated the potential damages at roughly $2.6 billion.
Musk, known for his prolific activity on X, did not immediately comment on the verdict. The decision represents a rare legal loss for Musk, often nicknamed “Teflon Elon” due to his history of escaping lawsuits unscathed. His lawyers highlighted that, on the same day, a Texas court cleared him in a separate defamation case.
In 2023, Musk had also been acquitted within hours by a San Francisco federal jury on similar claims from Tesla shareholders linked to his 2018 tweets about taking the automaker private.
The California civil complaint argued that Musk manipulated Twitter’s stock price to renegotiate the purchase or exit the deal, causing financial losses for shareholders who sold their shares. During the acquisition process, Musk tweeted that the deal was temporarily on hold until Twitter could verify the proportion of automated accounts (“bots”), a statement the plaintiffs said was part of a broader strategy to pressure the board into accepting a lower price while Tesla’s stock was declining, increasing the amount Musk would have to sell to fund the purchase.
Musk ultimately abandoned his attempt to terminate the acquisition in late 2022 after Twitter enforced the contract through court proceedings. Since then, he has merged the platform with his xAI venture and his private space company SpaceX.
According to Forbes, Musk’s net worth is estimated at $839 billion, largely tied to his holdings in Tesla, SpaceX, and other companies.
