Elon Musk to Testify in Twitter Shareholder Lawsuit

Elon Musk is scheduled to testify on Wednesday in a shareholder lawsuit concerning his $44 billion acquisition of Twitter, which took place in 2022. The lawsuit, filed in October 2022 in the U.S.

District Court for the Northern District of California, alleges that Musk made false and misleading public statements that depressed Twitter's share price. The plaintiffs, representing Twitter shareholders who sold shares between May 13 and October 4, 2022, claim Musk violated federal securities laws by making statements designed to undermine market confidence in Twitter, thereby pushing down its stock price.

Musk, who is the CEO of Tesla, announced the deal on May 13, 2022, but the lawsuit contends that Twitter did not consent to an indefinite pause in the transaction, nor did the merger agreement grant Musk the right to do so. The plaintiffs argue that Musk's disparaging remarks about Twitter's business were part of a broader effort to delay and renegotiate the acquisition.

Musk had waived due diligence as part of the offer, meaning he relinquished the right to review non-public information before the final agreement. On October 4, 2022, Musk reversed his course and agreed to proceed with the original $44 billion deal, which closed later that month.