Elon Musk Sued By Twitter Shareholders For Manipulating Company’s Stock

After signing the agreement, the complaint alleges, “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 use to either back out of the purchase or re-negotiate the buyout price.”

The lawsuit is a proposed class action brought by a small group of shareholders who are seeking damages that would be distributed among anyone holding the company’s stock.

The lawsuit also claims that Musk broke California laws by sharing his doubt about whether he would complete the deal after signing the contract to buy it.

Earlier this month, Musk said he was putting the Twitter acquisition “on hold” to learn more about “inauthentic” activity on the platform, including information about fake or automated accounts.

“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 use to either back out of the purchase or to re-negotiate the buyout price by as much as 25%, which, if accomplished, would result in $11 billion reduction in the Buyout consideration,” the complaint said.

According to California law, corporations in the state have to exclude board members from voting on proposals if they have engaged in some kind of misconduct relevant or connected to those proposals

Twitter has yet to comment on the matter. Elon Musk or his representative have not responded to these recent claims.