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 that were 'carefully calculated to drive down the price of Twitter stock'.

Why it matters

This case highlights the ongoing legal battles surrounding Musk's high-profile acquisition of Twitter and the allegations that he manipulated the company's stock price for his own benefit. The outcome could have significant implications for Musk's reputation and future business dealings.

The details

The lawsuit was filed in October 2022 on behalf of Twitter shareholders who sold their stock between May 13 and October 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 engaged in a scheme to renegotiate the purchase price or delay the merger by making these misleading statements.

• On May 13, 2022, Musk declared the Twitter deal was 'temporarily on hold'.
• In the following weeks, Musk continued to make disparaging statements about Twitter's business that drove the stock down.
• In July 2022, Musk said he would abandon the offer to buy Twitter after the company failed to provide enough information about fake accounts.
• On October 4, 2022, Musk offered to go through with the original $44 billion deal, which Twitter accepted.

What’s next

The judge will hear Musk's testimony on Wednesday as part of the shareholder trial.