Topline
A Twitter investor filed a lawsuit against Elon Musk on Monday accusing the billionaire of manipulating the markets in order to secure a better deal, the latest legal challenge to emerge from his turbulent efforts to buy the firm.
Elon Musk was sued by a Twitter investor in California federal court.
Key Facts
Musk’s repeated u-turns on whether he was willing to buy Twitter and his public attacks on the company were deliberate efforts to lower the firm’s share price and secure a better deal, investor Giuseppe Pampena alleged in a lawsuit.
According to the class action lawsuit, filed Monday in federal court in San Francisco, Musk’s statements and behavior were intended to “create doubt about the deal” and drive down Twitter’s share price, giving Musk leverage to negotiate a better price.
Musk reportedly hoped to use this leverage to secure as much as 25% off the original deal, which amounts to $11 billion.
Musk’s most recent u-turn, moving ahead with buying the company at the originally agreed upon price of $44 billion, shows he had no intention of walking away and was “bluffing all along,” the lawsuit said.
His conduct was “fraudulent and illegal,” the lawsuit alleged.
The law firm representing Musk in his Twitter deal did not immediately respond to Forbes’ request for comment.
News Peg
Musk offered to buy Twitter for $44 billion in April, later backing out of the deal in July. He slammed the firm publicly over issues including the number of fake or bot accounts on the platform and its approach to free speech. Twitter sued to push the deal through. In October, just weeks before the matter was set to go to trial, Musk u-turned again and agreed to honor the original terms of the deal if Twitter dropped its litigation against him. The deal has not yet closed and the billionaire’s anticipated deposition in court has been postponed to allow both parties time to hash out details.
Forbes Valuation
$219.8 billion. That’s the estimated net worth of Musk, according to Forbes’ real-time tracker, making him the richest person on the planet.
Further Reading
Musk Sued by Twitter Investor Over ‘Fraudulent’ Buyout Flip-Flop (Bloomberg)
Elon Musk’s Bizarre Week: Twitter Deal Moves Ahead, Tesla Stock Tanks, Zooming’ With Putin (Forbes)