A federal jury in California has ruled that tech tycoon Elon Musk misled Twitter shareholders, causing a decline in the company's share price as he was poised to acquire it in a $44 billion deal. The verdict, delivered on Friday in a class-action securities lawsuit, means the world's richest person could be ordered to pay billions of dollars, with damages calculated by jurors estimated at around $2.6 billion, according to plaintiff lawyers.
After a three-week trial in a San Francisco federal court, which included in-person testimony from Musk, the jury found that two tweets posted by the Tesla and SpaceX CEO in May 2022 contained false statements responsible for a plunge in Twitter's share price. The suit was filed by investor Giuseppe Pampena on behalf of individuals who sold Twitter shares between mid-May and early October 2022.
Jurors agreed that Musk violated a securities rule prohibiting false and misleading statements that sink a stock price, specifically that of Twitter. However, the nine-person jury absolved Musk of some fraud allegations, finding that he did not "scheme" to mislead investors. Minutes after the judgment was announced, lawyers for Musk, who acquired the social media platform in late October 2022 and later renamed it X, stated their client will appeal the decision, characterizing it as a "setback."
Musk, who maintains a near-constant presence on X, did not immediately react to the verdict, which marks a rare legal defeat for the billionaire often dubbed "Teflon Elon" for his ability to emerge unscathed from lawsuits. In 2023, a jury in the same San Francisco federal court cleared him within hours of similar charges brought by Tesla shareholders, following his 2018 tweets claiming he had funding to take the automaker private.
Musk abandoned efforts to exit the Twitter purchase in late 2022 after the company took him to court to enforce the contract. He has since merged the social media platform with his artificial intelligence startup xAI and his private space exploration firm SpaceX. Forbes magazine earlier this month estimated Elon Musk's net worth at $839 billion, primarily based on his stakes in companies like Tesla and SpaceX, though this verdict could impact his financial standing.
Source: www.aljazeera.com