Elon Musk acknowledged in court this week that the message he published, in 2022, about purchasing Twitter, currently X, “may not have been his most sensible decision”.
At the center of a huge process, in which investors demand compensation for billions of dollarsallegedly market manipulation.
The businessman testified Wednesday before a federal jury in San Francisco, California, and denied that the tweet was intended to influence the company’s stock price during the takeover battle. At issue is the one from May 13, 2022, in which Musk stated: “the agreement with Twitter is temporarily suspended pending details that prove that spam/fake accounts do, in fact, represent less than 5% of users”.
That day, after the tweet, the shares fell 9% at the opening of the market.
The authors of the action maintain that the richest man in the world tried to gain negotiating leverage by threatening to abandon the purchase, despite knowing — or at least should have known — that the contract would legally oblige him to proceed with the operation under the agreed terms.
The binding agreement, worth US$44 billion, had been signed in April 2022, after Musk waived the right to carry out additional due diligence, in an attempt to make the proposal more attractive to Twitter’s board of directors.
In court, Musk has now said that he wrote the message in the early hours of the morning and without consulting advisors or friends, and that the “on hold” comment was literal, comparable to saying that he would be late for a meeting, not that he would give up attending. The tycoon also admitted that he did not consider how investors might interpret the publication.
“Maybe it wasn’t my most sensible tweet,” the X owner said in court. “I don’t know if I’d call it incredibly stupid… but if you brought it to this trial, it probably qualifies as such.”
Days after this tweet, Musk continued to criticize the number of bots after this tweet and accused Twitter of providing false information in regulatory communications. The shares ended up falling to just over 30 dollars, well below the agreed price of 54.20 dollars per share. Some shareholders sold at this stage, before the purchase was completed in October under the original terms, after Twitter’s board went to court to force the deal to close, according to .
Prosecution lawyers also presented emails from Barclays sent before and after publication, in which bankers suggested that the threat of abandonment could create an opportunity to renegotiate the price. Musk responded that this reading corresponded to his understanding of the situation.
The defense rejects the manipulation thesis and says that Musk was just expressing genuine concerns about the bot problem.
If the jury rules in favor of the investors, they are expected to seek multi-billion dollar damages.
