Elon Musk has been found liable by a California jury for misleading Twitter shareholders amid his $44 billion acquisition of the social media platform in 2022.
On Friday, the jury in the class-action case Pampena v. Musk found that the Tesla mogul’s tweet claiming the deal was “temporarily on hold” was harmful and misleading, resulting in Twitter’s shares sliding almost 10% in a session. The verdict could cost Musk up to $2.6 billion in damages.
Although Musk claimed his hesitation was over Twitter’s claimed number of bots, spam and fake accounts, former shareholders felt it was a scheme to pressure the company into lowering the price of its shares. The jury unanimously determined after four days of deliberation that he did not specifically engage in a scheme to defraud investors.
Joseph Cotchett, who represents the former shareholders, told CNBC outside the San Francisco courthouse, “This is a great example of what you cannot do to the average investor — people that have 401ks, kids, pension funds, teachers, firemen, nurses. That’s what this case was all about. This was not about Musk. It was about the whole operation.”
Musk’s attorney Quinn Emanuel said in a statement to the outlet, “We view today’s verdict, where the jury found both for and against the plaintiffs and found no fraud scheme, as a bump in the road. And we look forward to vindication on appeal.”
In October 2022, Musk agreed to buy Twitter for the originally proposed price of $54.20 per share, before renaming the platform X. The deal resulted in him offloading $4 billion of Tesla stock in the following weeks.
