Elon Musk And Twitter Sued By Investor Over Platform Takeover Bid
Washington, May 27: Elon Musk and Twitter are being sued by a company investor over the handling of the billionaire’s $44bn (£34.9bn) bid for the tech giant, BBC reported on Friday.
The investor alleges that Musk has violated California corporate laws in a number of ways, accusing him of “wrongful conduct” as his “false statements and market manipulation have created ‘chaos’ at Twitter’s headquarters in San Francisco”.
Twitter shares are around 27 per cent lower than Musk’s $54.20 offer price.
The proposed class action lawsuit was filed this week at the US District Court for the Northern District of California by investor William Heresniak, who said he was acting “on behalf of himself and all others who find themselves in a similar situation”.
A class-action is a lawsuit that has been filed or is defended by an individual acting on behalf of a group of people. The lawsuit claimed that Musk benefitted financially by delaying the disclosure of his significant stake in Twitter, and his plan to become a board member of the company.
It also claimed that several tweets posted by Musk, who is a regular Twitter user with more than 95m followers, were “misleading”, including the one in which Musk said his takeover bid for the social media firm was on hold because of his doubts over the number of fake accounts on the platform.
This tweet posted on 13 May “constituted an effort to manipulate the market for Twitter shares as he knew about the fake accounts,” the lawsuit said, adding that Musk “doubled down” on his allegations four days later, by stating on Twitter that the deal “cannot go forward”.
