UNITED STATES – Tech billionaire Elon Musk suffered a rare legal defeat on Friday when a federal jury in California found he misled Twitter shareholders in 2022, driving down the company’s share price ahead of his $44 billion acquisition.
The verdict in the class action securities lawsuit could result in Musk being ordered to pay approximately $2.6 billion in damages, according to calculations by jurors.
The jury found that two tweets posted by the Tesla and SpaceX chief executive in May 2022 contained false statements that caused Twitter’s share price to plunge. The lawsuit, filed by investor Giuseppe Pampena on behalf of shareholders who sold Twitter shares between mid-May and early October 2022, alleged that Musk deliberately manipulated the stock price to gain leverage in renegotiating the purchase price or withdrawing from the deal entirely.
During the acquisition process, Musk tweeted that the deal was temporarily on hold until Twitter executives could prove the percentage of “bots” was as low as the social media platform claimed. The plaintiffs contended these statements were part of a scheme to pressure the board into accepting a lower price, particularly as Tesla’s share price was falling at the time.
Musk’s lawyers announced minutes after the verdict that their client would appeal the decision. The entrepreneur acquired Twitter in late October 2022 and subsequently renamed it X.
The judgment marks an unusual legal defeat for Musk, who has previously been cleared in similar cases. In 2023, a jury in the same San Francisco federal court acquitted him of charges brought by Tesla shareholders over 2018 tweets claiming he had secured funding to take the automaker private.
Separately, French prosecutors revealed on Saturday they had alerted US authorities to concerns that Musk may have encouraged the creation of sexualised deepfakes on X to artificially increase the value of his company.
The Paris prosecutor’s office stated that the controversy surrounding sexually explicit deepfakes generated by Grok, X’s artificial intelligence system, “may have been deliberately generated in order to artificially boost the value of companies X and X AI” ahead of a planned June 2026 stock market listing of a merged entity between SpaceX and X AI.
Forbes magazine estimated Musk’s net worth at $839 billion earlier this month, based primarily on his stakes in Tesla and SpaceX.
