Jordan Bevan
A Twitter investor filed a securities class-action complaint on Monday against Tesla CEO Elon Musk, accusing him of manipulating the social media company’s stock price in a ‘’fradulent and illegal’’ manner.
As reported by Bloomberg, investor Giuseppe Pampena claims that Musk’s statements about Twitter were designed in a way to cause questions about the acquisition and Twitter shares to go down so that he could either walk away from the deal or get the deal price to go down substantially.
Elon Musk first offered to acquire Twitter for $44 billion in April, however, announced that he would terminate the deal soon after, saying that Twitter wasn’t being transparent about the bot accounts on the platform.
According to the lawsuit which was filed in federal court in San Francisco, Musk then ‘’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 by as much as 25% which, if accomplished, would result in an $11 billion reduction in the buyout consideration.’’
‘’Musk’s conduct was fraudulent and illegal,” Pampena said.
He added that when Elon Musk agreed to buy Twitter at the original price last week, he ‘’essentially acknowledged that he had been bluffing all along” about walking away from the acquisition.
After Musk offered to close the acquisition, Delaware Judge Kathaleen McCormick halted the trial on Friday, giving the parties until October 28 to make out a deal.
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