Jury Finds Musk Liable for Misleading Twitter Investors

A federal jury in San Francisco has found Elon Musk liable for misleading investors by deliberately driving down Twitter’s stock price through two tweets, but absolved him of more serious allegations that he schemed to defraud shareholders. The verdict came after nearly four days of deliberation following a three-week trial over Musk's $44 billion acquisition of Twitter in 2022.

The jury awarded shareholders damages ranging from about $3 to $8 per share, which plaintiffs' lawyers estimated amounts to approximately $2.1 billion. The case centered on whether Musk’s public statements, including a tweet that the deal was 'temporarily on hold,' were intended to lower Twitter's stock price so he could renegotiate or back out of the acquisition.

Much of the trial focused on Musk's claims about the number of bots and fake accounts on Twitter. According to multiple sources, including Al Jazeera and AP News, Musk testified that Twitter had a much higher percentage of these accounts than disclosed in regulatory filings. He claimed at least 20% were fake, while former CFO Ned Segal disputed this during testimony, stating the number was closer to 1%. The jury found that while Musk misled investors with two tweets, he did not do so intentionally through a statement made on a podcast.

The trial also highlighted Twitter's past issues with user metrics. As reported by Al Jazeera and AP News, the company had previously paid $809.5 million in 2021 to settle claims of overstating its growth rate and monthly user figures. Musk's legal team argued that his tweets were genuine concerns about bots, not an attempt to defraud investors. Lawyers for Musk called the verdict 'a bump in the road' and said they look forward to vindication on appeal.