A jury in San Francisco has found Elon Musk liable for misleading investors by deliberately driving down Twitter’s stock price in the months before his 2022 acquisition of the company for $44 billion, though jurors rejected some fraud claims, concluding he did not “scheme” to defraud shareholders. The verdict stems from a class-action suit by investors who sold Twitter shares while the deal was in flux.
The nine-person jury decided that two tweets by Musk—including a May 13, 2022 message saying the deal was “temporarily on hold” while he sought information about fake accounts—misled investors and caused losses for sellers. However, the jury found that a statement Musk made on a podcast was an opinion and did not constitute actionable fraud, and it cleared him of the allegation he engaged in a broader scheme to depress Twitter’s share price.
Jurors deliberated nearly four days after a trial that lasted almost three weeks and began March 2. They awarded damages of roughly $3 to $8 per share per trading day, a figure plaintiffs’ lawyers estimate will total about $2.1 billion. Musk’s net worth is currently estimated at about $814 billion, largely tied to Tesla stock.
Plaintiffs’ attorney Joseph Cotchett called the verdict “an important victory” for investors and public markets, saying it shows wealth and power do not place someone above the law. Musk’s lawyers declined to comment as they left the courtroom.
Central to the case were Musk’s public claims about the prevalence of bots on Twitter. Musk testified that Twitter understated the number of fake and spam accounts—reporting about 5% in regulatory filings—and that the company misled him about how such accounts were counted. He used those concerns to justify trying to abandon the purchase. After Twitter sued in Delaware to enforce the merger agreement, Musk ultimately agreed to complete the deal at the original price.
Former Twitter CEO Parag Agrawal and CFO Ned Segal were among witnesses who testified during the trial. Musk testified for more than a day, calling Twitter’s calculations “BS” and insisting Twitter leadership had misled him about bot estimates. He also said completing the deal at the agreed price produced a windfall for most shareholders.
Plaintiffs argued Musk’s tweets were deliberate, calculated moves to lower Twitter’s market value so he could renegotiate or exit the deal as Tesla’s stock fell and the acquisition grew more costly. They urged jurors to hold him accountable for the losses of shareholders who sold amid the uncertainty caused by his public statements. In closing, plaintiff lawyer Mark Molumphy told jurors, “He knew what he was doing.”
Musk’s defense sought mistrial motions at times during the contentious proceedings, contending he could not get a fair trial in San Francisco because of local animus. This is not Musk’s first courtroom battle over his social media statements: in 2020 he testified at length in a federal trial over a 2018 tweet about taking Tesla private for $420 per share, and a jury in that case cleared him of wrongdoing.