In the US, a jury ruled that Elon Musk misled investors with his tweets during the process of acquiring Twitter in 2022. Musk may have to pay billions of dollars in damages to Twitter shareholders.
In a lawsuit filed regarding Elon Musk's acquisition of Twitter for $44 billion in 2022, former investors achieved a significant victory in federal court. A San Francisco jury ruled that Musk's tweets regarding fake accounts on the platform misled investors. However, the jury sided with Musk on some other claims in the case.
May Pay $2.1 Billion in Damages
It is not yet clear how much compensation Musk will have to pay, but according to the Associated Press, this amount could reach billions of dollars. The jury calculated that shareholders suffered a loss of approximately $3 to $8 per share daily. Lawyers for the plaintiffs stated that this amounts to approximately $2.1 billion.
The class-action lawsuit is one of several filed after Musk's acquisition process. Plaintiffs alleged that Musk's statements, particularly those concerning fake accounts, were deliberately aimed at driving down the share price, thereby seeking to renegotiate or entirely cancel the deal.
The lawsuit specifically highlighted a tweet from May 13, 2022, in which Musk stated that the deal was "temporarily on hold" due to the number of fake accounts. A subsequent tweet a few days later, implying that the fake account rate could be over 20%, was also emphasized. Following these statements, Twitter shares experienced a significant drop.
During the court proceedings, Musk argued that these posts were merely "expressing his thoughts" and claimed that company executives had provided false information regarding bot numbers. In response, former shareholders stated that Musk's inconsistent statements forced them to sell their shares at low prices.
Musk faced various other lawsuits throughout and after the acquisition process. These included lawsuits related to his failure to disclose his stake in the company on time and compensation lawsuits filed by former executives. He also narrowly avoided going to court in a lawsuit filed over his attempt to withdraw from the agreement.
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