A federal jury in San Francisco has determined that Elon Musk made misleading statements about the number of spam and bot accounts on Twitter shortly after agreeing to acquire the company for $44 billion in April 2022.
Jury Findings
The jury found Musk liable for two statements:
- His claim that the deal was “temporarily on hold” pending verification of bot data
- His suggestion that fake accounts could exceed 20%
However, the jury also found that shareholders failed to prove a separate allegation that Musk orchestrated a scheme to defraud them.
Potential Damages
Damages have not yet been finalized, but plaintiffs’ attorney Francis Bottini estimated losses could reach as high as $2.5 billion. The lawsuit represents shareholders who sold stock at depressed prices between May and October 2022 due to Musk’s public comments.
Response to the Verdict
“Musk’s status as the world’s richest man is not a free pass,” Bottini said. “If you’re able to move markets with your tweets, you’re responsible for the harm you cause to investors.”
Musk’s Plans to Appeal
Musk’s legal team argued that his concerns about bots were genuine and not fraudulent. In a statement, his attorneys called the verdict “a bump in the road” and said they expect to prevail on appeal.
Twitter Deal and Ongoing Legal Battles
Musk ultimately completed the acquisition of Twitter in October 2022 and later rebranded it as X. The case is one of several legal challenges he has faced related to his public statements and business dealings, including past litigation involving Tesla Inc. shareholders.