Elon Musk Defends Pre-Acquisition Twitter Posts in Shareholder Trial

Elon Musk testified in a San Francisco federal court on Wednesday, defending his online posts made leading up to his $44 billion acquisition of Twitter (now X) in 2022. He stated the posts reflected his genuine thoughts at the time and were not intended to manipulate the market or lower the platform’s valuation.

Shareholder Lawsuit Allegations

A group of Twitter stockholders filed a lawsuit alleging Musk attempted to manipulate the market with his statements, aiming to reduce the acquisition price. The plaintiffs claim Musk made misleading statements, including announcing his intention to pull out of the deal in July 2022, which influenced their decisions regarding their shares. They are seeking unspecified damages.

Musk’s Testimony

Musk asserted that his tweets were “extremely literal” and represented what he was thinking in the moment. He acknowledged that he may have made “stupid tweets” but maintained he didn’t anticipate his posts would significantly impact Twitter’s share price. He stated, “What I suppose privately is what I say publicly, there’s no difference.”

He specifically addressed a post stating the acquisition was “on hold,” explaining he didn’t expect it to cause a stock price decline. Musk also revealed his dissatisfaction with Twitter’s board, believing they misrepresented the platform’s user base and overall worth.

Initial Deal and Concerns

Musk initially agreed to buy Twitter in April 2022. However, on May 13, he announced the deal was “temporarily on hold” due to concerns about the number of spam and fake accounts. He later tweeted that the deal “cannot go forward,” claiming nearly 20% of accounts were fraudulent. Following the announcement of his initial stake in Twitter, the stock price surged by 27% in a single day, a figure Musk himself acknowledged “sounds high.”

Legal Arguments

The lawsuit centers on whether Musk’s statements violated federal securities laws. The plaintiffs argue his public statements were “carefully calculated to drive down the price of Twitter stock.” Musk’s defense hinges on his claim that he was simply expressing his genuine concerns and not attempting to manipulate the market.

The trial is ongoing in the U.S. District Court for the Northern District of California.