Elon Musk heads to court over Twitter stock allegations

Elon Musk’s big day in court

It’s not every day the world’s richest person has to answer for his social media posts. But that’s exactly what happened in a San Francisco courtroom when Elon Musk took the stand to defend himself against a lawsuit from Twitter shareholders.

The shareholders claim his tweets caused the company’s stock price to drop before he eventually bought it. They say Musk’s actions cost them money, and now they want him to pay up. The trial has drawn huge crowds and major media attention from around the globe.

What this lawsuit is all about

This case is a class-action lawsuit, which means a group of people joined together to sue Musk. These are Twitter shareholders who sold their stock between May 13 and Oct. 4, 2022. They argue that Musk made false statements that unfairly drove down Twitter’s stock price.

They claim he violated federal securities laws by trying to tank the value of the company. According to the lawsuit, his goal was to either get a better price for the deal or get out of it entirely. The lawsuit was filed in 2022, after Musk agreed to buy Twitter but before he completed the purchase.

The $44 billion Twitter deal explained

To understand the lawsuit, you have to go back to April 2022. That’s when Elon Musk first agreed to buy Twitter and take it private for a huge $44 billion, or $54.20 per share. It seemed like a done deal, and Twitter’s board accepted the offer.

But just a few weeks later, in May, Musk suddenly put the brakes on. He announced the deal was temporarily on hold and said he needed more info about fake accounts. Twitter’s stock tumbled nearly 10% in one day, and that’s when shareholders say the trouble began.

The big problem with fake accounts

Why did Musk put the deal on hold? He said he needed more information about spam and fake accounts on the platform, which he called bots. He even tweeted that the deal cannot go forward if the numbers weren’t right.

Musk claimed that Twitter’s estimate of less than 5% fake accounts was way too low. He thought the real number was much higher, possibly close to 20%, and he felt the company wasn’t being honest with him. In court, he compared saying the bot number was high to saying the grass is green or the sky is blue.

Fun fact: Twitter had been disclosing its bot estimates to the SEC for years, while also warning that its estimate might actually be too low.

‘I was simply speaking my mind’

In court, the shareholders’ lawyer asked Musk over and over if he thought about how his tweets would affect the stock market. Musk’s answer was simple and direct: “I was simply speaking my mind.”

He said he didn’t think his early stock purchases were a big deal, and he felt free to talk about his concerns. This is a key part of his defense, that he was just being honest, not trying to manipulate the market for his own gain.

Little-known fact: Musk began buying Twitter stock in early 2022 and didn’t tweet about it, but once his stake was revealed, the stock jumped 27% in a single day.

Did he try to blow up the deal?

The lawsuit paints a picture of Musk doing everything he could to get out of the deal he agreed to. It claims he kept making negative statements about Twitter’s business to drive the stock price down even further.

By July 2022, Musk officially said he was abandoning the deal, again pointing to the bot problem. By then, Twitter’s stock had fallen to about $36.81, which was 32% below what he had originally offered to pay. Shareholders who sold during this time took major losses.

Twitter fought back in court

Musk couldn’t just walk away without a fight. Twitter took him to court in Delaware to force him to complete the purchase as they had originally agreed. It was a high-stakes legal battle between the company and the billionaire.

Just as that trial was about to start, Musk changed his mind again. In October 2022, he agreed to go through with the original $44 billion deal, and he officially took control of the company later that month. The legal fight ended almost as quickly as it began.

Why Musk says he gave in

So why did Musk finally decide to buy the company after trying so hard to get out of it? He testified that his lawyers gave him some blunt advice. They told him the judge in the Delaware case was extremely biased against him, and he had no chance of winning.

His lawyers believed he had no real chance of prevailing in her court. To back up his point, Musk mentioned that the same judge later canceled his huge pay package from Tesla, though that decision was later overturned. He said he followed his lawyers’ advice to complete the deal.

Musk’s fortune is on display

It’s hard to wrap your head around the amount of money involved here. Musk is currently the richest person in the world, with a fortune estimated at a staggering $841 billion. The $44 billion he paid for Twitter is just a piece of that massive wealth.

This fact isn’t lost on the shareholders, who are seeking damages for their losses. They argue that even a small dip in stock price caused by Musk’s tweets represents a huge amount of money for regular investors trying to save for retirement or other goals.

What I think privately is what I say publicly

One of the most memorable moments from Musk’s testimony was when he talked about his own personality. He admitted that his posts on X probably reveal too much about what’s going on in his head.

What I think privately is what I say publicly, Musk told the court. It was a simple statement that explains a lot about his very public and often unpredictable online presence that has millions of followers hanging on his every word.

This isn’t his first courtroom battle

Believe it or not, this isn’t the first time Musk has had to defend his tweets in this very same courthouse. About three years ago, he spent roughly eight hours testifying in a different trial about Tesla.

In that case, investors sued him over a 2018 tweet where he claimed he had “funding secured” to take Tesla private at $420 per share. That deal never happened, and a jury eventually decided Musk wasn’t liable for any wrongdoing. In a separate 2018 settlement with U.S. securities regulators over the same tweet, he stepped down as Tesla’s chairman but remained CEO.

The big changes at X

After Musk finally bought the company, he moved fast to make huge changes. He slashed the workforce by about 80%, cut back on how the site polices content, and changed the name from Twitter to X in July 2023.

These moves have been controversial, but they don’t directly affect this lawsuit. The case is all about what happened before he took over, focusing on the chaos and confusion caused while the deal was up in the air. The company looks very different today than it did in 2022.

If you’re curious about some of Musk’s other big promises, take a quick look at the Elon Musk claims that went unfulfilled in 2025.

What happens next in the trial

The trial in San Francisco is scheduled to continue until around March 19th. Musk is expected to be back on the stand for more questioning as the case unfolds before the jury and judge.

The jury will have to decide if Musk’s tweets were just honest talk or if they were deceptive statements that broke the law. Either way, it’s another historic chapter in the ongoing story of Elon Musk and his impact on the stock market and social media.

And if you want to see the latest controversy surrounding his tech ventures, check out Elon Musk’s AI sparks concerns over inappropriate content.

Do you think Elon Musk was just being honest, or did his tweets go too far? Drop your thoughts in the comments below and give this post a thumbs up.

This slideshow was made with AI assistance and human editing.

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