Twitter shareholders sue Elon Musk over market manipulation

Twitter shareholders have filed suit against Elon Musk and the social network itself over the ‘chaotic process’ of the takeover. They allege that the Tesla chief violated the law and manipulated the market, CNBC reports.

According to the plaintiffs, the entrepreneur benefited financially by delaying disclosure of his stake in Twitter and temporarily concealing his plan to join the social network’s board.

The suit also alleges that Musk purchased the company’s shares while in possession of material non-public information.

Shareholders contend that the Tesla chief violated California law by sowing doubts about the closing of the deal. The suit’s initiators argue that the halt in the purchase prompted by concerns over a possibly large share of fake accounts on Twitter was part of a scheme; they say that, in doing so, Musk sought more favorable terms or to derail the deal.

The shareholders maintain that the entrepreneur’s tweets and statements were aimed at depressing the company’s stock.

In April, Elon Musk became the largest shareholder of Twitter, buying 9.2% of the social network’s securities.

Later it emerged that the Tesla chief planned to acquire the company for $44 billion. He described the move as aiming to create an ‘inclusive arena for freedom of speech’.

In May, Musk halted the purchase process after media reports that the social network’s audience metrics had been inflated.

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