Elon Musk Liable for Misleading Twitter Investors Before $44 Billion Acquisition
A California jury found Elon Musk liable for misleading investors in Twitter, now known as X, prior to his $44 billion acquisition of the social media company in 2022. The verdict, issued on Friday, March 20, 2026, could result in damages reaching up to $2.6 billion, according to attorneys representing the plaintiffs.
Key Findings of the Lawsuit
The class-action lawsuit, Pampena v. Musk, alleged that Musk intentionally misled investors about the number of bot and spam accounts on the Twitter platform. The jury determined that Musk was liable for misleading investors with two specific tweets, including one stating the deal was “temporarily on hold.” However, the jury found he did not intentionally “scheme” to defraud investors and absolved him of some fraud allegations NBC News.
Background of the Acquisition and Lawsuit
Musk initially bid to buy Twitter in April 2022, but subsequently expressed doubts about the deal, particularly concerning the prevalence of bots. He completed the acquisition in October 2022 for $54.20 per share, and later rebranded the company as X. Following the acquisition, X was merged with Musk’s artificial intelligence company, xAI, and then with SpaceX, his reusable rocket manufacturer CNBC.
Potential Damages and Legal Response
The potential damages could reach $2.6 billion, impacting thousands of shareholders, including those with 401(k)s, pension funds, and other institutional investors. Joseph Cotchett, an attorney for the plaintiffs, emphasized the case’s importance for average investors CNBC.
Musk’s legal team, Quinn Emanuel, stated they view the verdict as a “bump in the road” and intend to appeal, arguing the jury found both for and against the plaintiffs and did not find a fraud scheme CNBC.
Implications for Investors
This verdict serves as a cautionary tale regarding transparency and accountability in high-profile acquisitions. It highlights the potential consequences for corporate leaders who make statements that could materially affect investor decisions Reuters.
The jury awarded shareholders between about $3 and $8 per stock per day NBC News.