Musk loses bid to overturn Twitter fraud verdict
What's the story
A US federal judge has denied Elon Musk's request to overturn a jury verdict that found him liable for defrauding Twitter investors during his 2022 takeover bid. The ruling by US District Judge Charles Breyer in San Francisco also rejected Musk's motion to decertify the class of investors and granted their request for prejudgment interest.
Case details
Musk was found liable for lying about Twitter's bot count
On March 20, Musk was found liable for attempting to lower Twitter's stock price so he could either renegotiate or back out of his $44 billion takeover. The jury found him liable for tweets posted on May 13 and May 17, 2022, where he questioned if Twitter was flooded with bots. Judge Breyer noted "substantial evidence of falsity" in the first tweet that led to a major drop in Twitter's stock price.
Market impact
Plaintiffs estimated damages could amount to $2.5 billion
The judge said there was no market reaction to the second tweet, which is why Musk wasn't held liable for it. A lawyer representing the plaintiffs had previously estimated damages could amount to around $2.5 billion. The investors accused Musk of falsely claiming that Twitter was overrun by bots in a bid to renegotiate his offer or back out of the deal altogether.
Ongoing litigation
Musk also fighting similar lawsuit in Manhattan
Musk, who bought Twitter in October 2022 for $44 billion and rebranded it as X, is also fighting a lawsuit in Manhattan. The suit accuses him of defrauding Twitter investors by delaying the disclosure of his initial investment, allowing him to buy shares at a lower price.