On Friday, a jury in California determined that Elon Musk had misled investors in Twitter via public statements that depressed the price of the company’s stock ahead of his ultimately successful purchase of the service. Because this was a class action lawsuit, Musk is likely to owe damages to a huge range of investors—payments that may ultimately reach billions of dollars.
In the lead-up to Musk’s ultimate purchase of the social media platform, he made a number of comments on the platform itself and while appearing as a guest on a podcast, largely focused on the alleged prevalence of bot accounts on the platform. This raised fears that the deal wouldn’t go through and depressed the price of Twitter’s shares, causing some investors to sell shares at a depressed price during this period.
A number of those investors started a suit that was certified as a class action, claiming that the statements defrauded them and that Musk made them intentionally as part of a larger scheme. The jury rejected arguments about this larger scheme but found Musk liable for the tweets.
While damages have yet to be determined, lawyers for the plaintiffs reportedly say that they could ultimately reach as high as $2.6 billion.
