A U.S. jury is weighing whether Elon Musk misled investors during his 2022 takeover of Twitter, as a high-stakes shareholder lawsuit approaches a verdict in federal court.
The case centers on claims that Musk intentionally drove down Twitter’s stock price by publicly questioning the platform’s number of fake accounts — part of what plaintiffs argue was a strategy to renegotiate or exit his $44 billion acquisition.
In closing arguments, lawyer Mark Molumphy, representing former shareholders, told jurors that Musk’s public comments damaged the company and its valuation.
“He trashed the company… and tanked the stock,” Molumphy argued, pointing to Musk’s repeated statements suggesting that fake or spam accounts could be far higher than Twitter’s disclosed estimate of under 5%.
According to the plaintiffs, Musk had already agreed to the acquisition when he began raising concerns about bots, and his remarks were aimed at creating leverage to secure a better deal.
Musk’s legal team pushed back, arguing that his concerns were legitimate and grounded in genuine uncertainty about the scale of fake accounts on the platform.
Defense lawyer Michael Lifrak told the jury that Musk was trying to understand the business he had agreed to buy — not manipulate the market.
“Two tweets and a podcast does not equal securities fraud,” Lifrak said, adding that the plaintiffs failed to prove any intentional deception.
Jurors are now considering two key questions: whether Musk’s statements about bots were false or misleading, and whether they were part of a deliberate scheme to defraud shareholders.
If the jury finds no fraud, Musk will prevail. If they determine misconduct occurred, they will then assess potential financial damages.
The dispute traces back to May 2022, shortly after Musk agreed to acquire Twitter. He publicly stated the deal was “on hold” while he examined the prevalence of bots and later said the acquisition could not proceed without clearer data.
Twitter ultimately sued Musk to force completion of the deal. He finalized the acquisition in October 2022 and later rebranded the platform as X.
The trial is one of several legal battles Musk has faced in recent years. He has previously gone to court over Tesla-related disputes — including shareholder litigation tied to Tesla — and has often chosen to fight cases rather than settle.
He is also currently in discussions to resolve a separate civil lawsuit brought by the U.S. Securities and Exchange Commission over the timing of his initial Twitter share purchases.
The outcome of the current trial could have broader implications for how executives communicate during major corporate transactions — especially when those statements have the potential to move markets.
The jury is expected to resume deliberations, with a verdict anticipated soon.