A federal jury in San Francisco has found Elon Musk liable for intentionally misleading Twitter shareholders ahead of his $44 billion acquisition of the platform, with potential damages of up to $2.6 billion. The verdict, delivered on Friday, marks a significant legal setback for the world’s wealthiest man.
The lawsuit centered on public statements Musk made about the prevalence of fake accounts on Twitter. Twitter had consistently maintained that bot and spam profiles accounted for no more than 5% of its monetizable daily active users. Musk publicly contradicted this, claiming his own analysis suggested the figure was closer to 33%, later revising it to around 20% while hinting the real number could be even higher. He used these claims to threaten pulling out of his proposed takeover deal.
How the Jury Ruled
The jury determined that Musk’s statements were a deliberate effort to suppress Twitter’s stock price, causing investors to sell their shares at deflated values. Musk was found liable for misleading those shareholders, and will be required to compensate them for their losses — a cumulative figure that could reach $2.6 billion. The class action suit was originally filed in October 2022.
What Comes Next
Musk’s legal team has pledged to appeal the ruling. This is not the first time Musk has faced legal consequences for his social media activity — though notably, he has previously prevailed in a Tesla stock manipulation case and a defamation lawsuit. Whether history repeats itself remains to be seen, as an appeal date is yet to be set.