A jury has ruled that Elon Musk engaged in stock fraud in the run-up to his Twitter purchase.
He lied about his early stock purchases, he lied about his intentions, and these lies were material to the transaction.
It's fraud.
A California jury found Elon Musk liable for misleading Twitter investors by making public statements casting doubt on his eventual $44 billion acquisition of the social media giant, contributing to a huge drop in the company's stock price.
A class-action lawsuit was filed in federal court against the world's richest man in 2022, just before he fully took control of Twitter.
The plaintiffs argued that they, along with countless other investors, were duped into selling their shares primarily because Musk tweeted that the Twitter deal was 'temporarily on hold' on May 13, 2022.
Musk was concerned there were many more spam or fake accounts on the platform than Twitter had publicly disclosed. He believed about five percent of all accounts were bots.
The plaintiffs argued that Musk made these statements to intentionally drive down the value of the shares so he could negotiate a lower purchase price.
On May 16, 2022, Musk publicly suggested that the deal price could change, saying during a Miami tech conference that it wouldn't be 'out of the question' to buy Twitter for less than the $44 billion that had already been agreed upon.
After nearly four days of deliberation, a nine-person jury in San Francisco found that Musk misled investors with his tweet saying the deal was 'temporarily on hold'.
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