Jury Finds Elon Musk Misled Twitter Investors Before $44 Billion Buyout — Damages Could Hit $2.6 Billion

A federal jury in San Francisco unanimously found Thursday that Elon Musk defrauded Twitter shareholders during the spring of 2022, as he publicly vacillated over whether to complete his $44 billion acquisition of the social media company while failing to disclose his actual intentions to the market. The verdict, reached after four days of deliberation in a trial lasting nearly three weeks, found that two specific tweets Musk posted in May 2022 were "materially false or misleading" and caused investors to hold or sell their shares at artificially depressed prices. Attorneys for the plaintiffs said total damages could reach $2.6 billion, with a separate damages phase expected to begin in coming weeks.

The two tweets at issue were posted during the period when Musk was claiming the deal was "temporarily on hold" while he investigated whether Twitter's bot and spam account numbers exceeded the five percent threshold the company had publicly disclosed. On May 13, 2022, Musk wrote: "Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users." On May 17, he posted that Twitter's user base could represent "20% fake/spam accounts" and that it "could be *much* higher." Plaintiffs argued that internal Musk communications showed he was already planning to exit the deal entirely — not merely pause it — and that the "on hold" language was designed to give him a negotiating weapon and escape route without triggering the $1 billion breakup fee.

The jury's verdict was mixed but consequential. While it found Musk had made false and misleading statements that harmed investors, it rejected the claim that he had engaged in a "scheme to defraud" — a higher legal standard requiring evidence of intentional, systematic wrongdoing. The jury also found that a comment Musk made on a podcast during the same period was not fraudulent because it constituted opinion rather than a statement of fact. Musk's legal team at Quinn Emanuel called the result "a bump in the road" and pledged to appeal, noting that the jury found no fraud scheme. Attorneys for the plaintiffs called it a landmark finding that would deter future market manipulation by technology executives.

Internal communications introduced during trial revealed how Musk operated throughout the spring of 2022. Text messages showed him telling confidants the deal was "a pain in the ass" and at one point contemplating a significant price reduction. Twitter's board believed from early May that Musk was acting in bad faith, directing then-CEO Parag Agrawal to preserve all communications in anticipation of litigation. Musk ultimately closed the acquisition in October 2022 after a Delaware court ruled he had to proceed or face potentially larger legal exposure. He then fired approximately half of Twitter's workforce, rebranded the service as X, and positioned the platform as a cornerstone of his political alliance with the Trump administration.

The potential $2.6 billion judgment would represent less than one percent of Musk's estimated net worth of over $300 billion. Tesla and SpaceX shares saw modest movements on the news. Trump, whose administration has relied on Musk as a senior adviser through the Department of Government Efficiency, did not comment publicly on the verdict as of Saturday. Legal scholars noted the verdict adds to a pattern of accountability findings against major tech executives in securities litigation and raises questions about the market impact of social media posts by figures whose fortunes are directly tied to the companies they comment on. Musk's post-verdict statement — "The truth will come out on appeal" — echoed his defiant posture throughout the trial.