Elon Musk found liable for misleading investors in Twitter deal

Federal Jury Finds Elon Musk Liable for False Statements Regarding Twitter Acquisition

A federal jury in California has delivered a verdict in a class action securities lawsuit against tech mogul Elon Musk, finding that two tweets he posted in May 2022 contained false statements that contributed to a decline in Twitter’s share price. The verdict was announced on Friday in the San Francisco federal court.

The lawsuit, filed by investor Giuseppe Pampena on behalf of individuals who sold their Twitter shares between mid-May and early October 2022, alleged that Musk made false statements about his plans for the company. The jury found that two specific tweets posted by Musk during this time period contained false information, which led to a decrease in Twitter’s stock price.

According to the verdict form, the jury determined that Musk violated a securities rule that prohibits making false and misleading statements that affect a stock price. The plaintiffs’ lawyer estimated damages at approximately $2.6 billion.

However, the nine-person jury also found that Musk did not intentionally scheme to mislead investors. Lawyers for Musk stated that their client intends to appeal the decision, describing it as a “setback.” Musk himself has yet to comment on the verdict.

This verdict marks a rare legal defeat for Musk, who is often referred to as having an ability to avoid lawsuits due to his high profile and financial resources. In 2023, a jury in the same San Francisco federal court cleared him of similar charges brought by Tesla shareholders following his 2018 tweets about taking the automaker private.

Source: Al Jazeera