SAN FRANCISCO (Diya TV) — A federal judge has refused to overturn a jury verdict that found Elon Musk misled Twitter investors during his $44 billion takeover of the social media company in 2022. The ruling marks another legal setback for the billionaire and keeps alive a case that could lead to billions of dollars in damages.
U.S. District Judge Charles Breyer issued the decision on Monday in San Francisco. He rejected Musk’s request to set aside the jury’s March verdict. He also denied Musk’s effort to decertify the class of investors involved in the lawsuit. In addition, the judge approved the investors’ request for prejudgment interest, which could increase the final financial award.
The case centers on two tweets Musk posted in May 2022 while he tried to acquire Twitter. Investors argued that Musk used those posts to push down the company’s stock price so he could renegotiate the deal or walk away from it. They claimed the tweets caused major financial losses for shareholders who sold their stock after prices dropped.
A jury agreed with those arguments on March 20. Jurors found Musk liable for statements he posted on May 13 and May 17, 2022. In those tweets, Musk questioned whether Twitter had far more fake and spam accounts, commonly known as bots, than the company had reported.
However, Judge Breyer partly sided with Musk in his latest ruling. He found that Musk was not liable for the May 17 tweet because investors failed to show that the post caused a market reaction. As a result, the judge concluded that the evidence did not support liability for that statement.
Even so, Breyer upheld the jury’s findings about Musk’s May 13 tweet. In that post, Musk said the Twitter acquisition was “on hold” until he received details showing that fake accounts made up less than 5% of users. The judge said the record contained substantial evidence that the statement was false.
Breyer also wrote that the jury had enough evidence to conclude that Musk wanted to escape the original agreement. According to the ruling, jurors could reasonably believe that Musk used concerns about bots as a reason to pressure Twitter during negotiations.
“Even if the speaker has a change of heart or a momentary regret about a transaction, such qualms do not justify lying to the investing public,” Breyer wrote in his decision.
The lawsuit has drawn significant attention because of the size of the deal and Musk’s influence in the technology industry. The Tesla and SpaceX chief completed the $44 billion purchase of Twitter in October 2022 after months of legal disputes over the agreement. Later, in July 2023, he renamed the platform X and replaced its well-known blue bird logo.
The investors argued that Musk’s comments hurt Twitter’s market value almost immediately. They said the May 13 tweet caused the company’s share price to fall about 18% over two trading days. As a result, many shareholders sold their stock at lower prices and suffered financial losses.
Following the March verdict, one attorney representing the investors estimated that total damages could reach about $2.5 billion. The addition of prejudgment interest could increase that amount if the court ultimately awards compensation.
Musk’s legal team did not immediately respond to requests for comment after Monday’s ruling. Lawyers representing the investors also did not immediately issue a public statement.
Meanwhile, Musk continues to face other legal challenges connected to his Twitter acquisition. A separate lawsuit in Manhattan accuses him of waiting too long to disclose his growing investment in Twitter before announcing his takeover plans. Investors in that case claim the delay allowed Musk to buy shares at lower prices while other shareholders sold their stock without knowing his intentions.
Monday’s ruling does not end the legal battle. However, it strengthens the investors’ position by keeping the jury’s key findings in place. As the case moves forward, the court will determine the final amount of damages, if any, that Musk must pay.
