Jury Finds Elon Musk Misled Investors in Twitter Deal, Dismisses Some Fraud Claims

Jury Finds Elon Musk Misled Investors in Twitter Deal, Clears Him of Fraud Scheme

A federal jury in San Francisco has ruled that Elon Musk misled investors during the lead-up to his $44 billion takeover of Twitter in 2022, while rejecting claims that he orchestrated a deliberate fraud scheme.

The verdict came after nearly four days of deliberations in a class-action lawsuit brought by shareholders. Jurors examined whether Musk’s tweets and public remarks in May 2022 influenced investors and affected the company’s stock price.

The nine-member panel found that two of Musk’s tweets—including one saying the deal was “temporarily on hold”—were misleading. However, it concluded that comments he made during a podcast did not amount to fraud, describing them as opinion rather than intentional deception.

Shareholders were awarded damages estimated at $3 to $8 per share per day, with total compensation pegged at around $2.1 billion, according to lawyers for the plaintiffs.

What the Trial Examined

The case largely focused on Musk’s claims about fake accounts on Twitter. He argued that the number of bots on the platform was significantly higher than the company’s stated figure of less than 5%, and cited this as a reason for attempting to walk away from the deal.

After Musk sought to exit the agreement, Twitter filed a lawsuit in Delaware to compel the acquisition. Days before that trial was set to begin, Musk reversed his decision and completed the purchase at the original price.

Jurors ultimately assessed whether Musk’s statements were aimed at driving down Twitter’s stock. While some tweets were deemed misleading, the panel found no evidence of a broader plan to manipulate the market.