Elon Musk Faces Billions in Damages in San Francisco Twitter Lawsuit

A San Francisco jury on Friday found Elon Musk liable for misleading investors in the period leading up to his $44 billion acquisition of Twitter, now known as X. While the jury did not find Musk intentionally schemed to defraud investors, it determined he misled them with two specific tweets, potentially exposing him to billions of dollars in damages.

The verdict concluded a three-week civil trial centered on a class-action lawsuit filed by shareholders who alleged Musk deliberately drove down Twitter’s stock price between May and October 2022. Investors claimed Musk’s statements about the number of bot accounts on the platform were intended to create a pretext for renegotiating or abandoning the acquisition deal, causing them financial losses when they sold their shares.

Jurors agreed that two tweets posted by Musk in May 2022 contained false statements. One tweet stated the deal to acquire Twitter was “temporarily on hold,” while another discussed the issue of bot accounts. However, the jury found Musk did not mislead investors during a statement made on a podcast during the same period.

The jury awarded shareholders damages ranging from $3 to $8 per share for each day the stock price was affected, totaling approximately $2.1 billion, according to lawyers representing the plaintiffs. This figure represents a fraction of Musk’s current estimated net worth of $814 billion, largely tied to his Tesla holdings.

Musk’s legal team has signaled their intention to appeal the verdict, calling it a “setback.” Musk himself has not yet publicly commented on the ruling. The lawsuit was brought by investor Giuseppe Pampena on behalf of shareholders who sold their Twitter stock during the specified timeframe.

The case marks a rare legal defeat for Musk, who has previously navigated numerous legal challenges without significant repercussions. The acquisition of Twitter, finalized in October 2022 and subsequently rebranded as X, has been marked by controversy and significant changes to the platform’s policies and operations.