Jury Finds Elon Musk Liable for Misleading Investors in Twitter Acquisition, Drops Some Fraud Charges

Twitter Acquisition Lawsuit Verdict

A San Francisco jury has found Elon Musk liable for misleading investors by intentionally driving down Twitter's stock price in the months leading up to his 2022 acquisition of the social media company for $44 billion. The verdict was delivered after 3 days of deliberation, nearly three weeks after the trial began on March 2.

The civil trial centered on a class-action lawsuit filed just before Musk took control of Twitter, which he later renamed X. The jury was asked to decide if two tweets and comments Musk made on a podcast in May 2022 amounted to him intentionally defrauding Twitter shareholders, who sold their shares based on Musk's statements. The jury found that while Musk was liable for misleading investors with two tweets, including one stating the Twitter deal was "temporarily on hold," he did not do so with a statement he made on a podcast and did not intentionally "scheme" to defraud investors.

The jury awarded shareholders between $3 and $8 per stock per day, but it is unclear what amount in damages Musk will have to pay to thousands of shareholders, many of them institutional investors, with the total likely in the billions. Musk's fortune is currently estimated at about $814 billion, much of it tied up in Tesla shares. The trial focused on Musk's claims about the number of bots on Twitter, with Musk testifying that Twitter had a much higher number of fake and spam accounts than the 5% it disclosed in regulatory filings.

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