Elon Musk Defends Tweets in Lawsuit Over Twitter Stock Drop

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Elon Musk continued to defend his actions in the months leading up to his 2022 purchase of Twitter in court on Thursday, as he faces a class action lawsuit claiming he misled investors and caused them to lose millions of dollars. The civil trial in San Francisco centers on allegations that Musk violated federal securities laws while taking steps to drive down Twitter's stock price in an attempt to either blow up the deal or negotiate a lower sales price.

Why it matters

This case highlights the ongoing legal battles surrounding Musk's high-profile acquisition of Twitter and the impact his statements and actions had on the company's stock price and shareholders. It raises questions about transparency, disclosure requirements, and the responsibilities of corporate leaders during major business transactions.

The details

The lawsuit represents Twitter shareholders who sold their stock between May 13 and October 4, 2022. Musk has continued to assert that Twitter had a much higher number of fake and spam accounts than the 5% it disclosed in regulatory filings, a claim he used to try to renegotiate the $44 billion deal. While the issue of bots on Twitter was not new, Musk and some analysts believe the number was at least 20%, significantly higher than Twitter's estimates.

• The class action lawsuit was filed just before Musk took control of Twitter in October 2022.
• The lawsuit covers the period from May 13 to October 4, 2022, when Twitter shareholders sold their stock.

What they’re saying

What’s next

The judge in the case will determine whether Musk's statements and actions violated federal securities laws and caused harm to Twitter shareholders who sold their stock during the specified period.