Updated · Nov 16, 2022
Twitter Investors Sue Elon Musk for Stock Manipulation
Updated · May 27, 2022
Wednesday’s lawsuit alleges that Musk’s illegal actions saved him $156 million.
Twitter investors hit Musk with a new lawsuit. It is based on claims that he manipulated the price of the company’s shares for personal gain.
The investors allege that he failed to disclose his purchase of more than 5% of Twitter shares by March 14th. They claim that this conduct saved the billionaire $156 million. The social media platform was also named as a defendant in the suit.
“By delaying his disclosure of his stake in Twitter, Musk engaged in market manipulation and bought Twitter stock at an artificially low price,” they argued.
Musk revealed a 9.2% stake in Twitter stock on April 4th. Ten days later, he proposed a takeover of the company after turning down an invitation to join the board. Since that bid, Twitter’s shares have been down by more than 12%.
This development is only the latest in a long line of twists since he made a deal to buy the company for $44 billion in April. Since then, he has publicly hit out against the company’s policies several times and put the deal on hold.
In another potential violation, the investors allege that these actions broke California’s laws.
“Musk proceeded to make statements, send tweets, and engage in conduct designed to create doubt about the deal and drive Twitter’s stock down substantially in order to create leverage that Musk hoped to either back out of the purchase or re-negotiate the buyout price.”
Neither the Tesla CEO nor Twitter has responded to the allegations so far.
Daniel is an Economics grad who fell in love with tech. His love for books and reading pushed him into picking up the pen - and keyboard. Also a data analyst, he's taking that leap into data science and machine learning. When not writing or studying, chances are that you'll catch him watching football or face-deep in an epic fantasy novel.
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