Science & Tech

Elon Musk hit with lawsuit from Twitter insider for tanking company stock

Elon Musk hit with lawsuit from Twitter insider for tanking company stock
Trevor Noah mocks Elon Musk's Twitter takeover
The Daily Show

Elon Musk’s journey to buy Twitter has not exactly been the smoothest, and now the entrepreneur has been hit with a lawsuit from Twitter shareholders for decreasing the company’s stock value.

The lawsuit against Musk on behalf of Twitter shareholders was filed in San Francisco’s federal district court on Wednesday (25 May) night.

Shareholders allege that Musk has actively manipulated the company’s stock for personal gain.

They allege that since signing the purchase agreement with Twitter's board on April 25, Musk’s conduct has been harmful to Twitter stock.

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They point to Musk’s statement in which he said the deal “cannot move forward” until has more information about bot accounts on the social media site.

The complaint claims: “Musk 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.”

The lawsuit requests an injunctive relief from the court that would force Musk to buy the company at the agreed-upon price.

It continued: “As detailed herein, Musk’s conduct was and continues to be illegal, in violation of the California Corporations Code, and contrary to the contractual terms he agreed to in the deal.”

The proposed class action is being brought by a small number of Twitter shareholders, but they are seeking damages that would be shared among everyone with Twitter stock.

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