Elon Musk to Testify in Twitter Shareholder Lawsuit

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Elon Musk is expected to take the stand in a shareholder trial in San Francisco, where he's accused of making false and misleading statements that drove down Twitter's stock price before he bought the social media platform for $44 billion in 2022. The lawsuit claims Musk violated federal securities laws by making public statements 'carefully calculated to drive down the price of Twitter stock.'

Why it matters

This case highlights the ongoing scrutiny and legal challenges Musk faces over his high-profile business dealings and social media activity. The outcome could have implications for Musk's future conduct as a major tech influencer and Twitter's operations under his ownership.

The details

The lawsuit was filed in October 2022 on behalf of Twitter shareholders who sold stock between May 13 and Oct. 4, 2022. It claims Musk made false statements, such as declaring the Twitter deal was 'temporarily on hold' and claiming nearly 20% of Twitter accounts were 'fake,' which caused the stock price to tumble. The lawsuit alleges Musk continued to make disparaging statements about Twitter's business to try to delay or get out of the deal, even though he had waived due diligence.

• Musk reached a deal to buy Twitter in April 2022.
• On May 13, 2022, Musk declared the Twitter deal was 'temporarily on hold'.
• In July 2022, Musk said he would abandon the offer to buy Twitter over the fake accounts issue.
• On Oct. 4, 2022, Musk offered to go through with the original $44 billion deal, which Twitter accepted.
• The Twitter acquisition deal closed in October 2022.

What’s next

Musk is expected to take the stand in the shareholder trial on Wednesday in San Francisco.