TWITTER INVESTORS SUE ELON MUSK FOR ALLEGED MANIPULATION OF STOCK
Twitter investors are suing Elon Musk and the social media platform over the handling of the billionaire’s $44bn (£34.9bn) bid for the company.
He is accused of breaking California corporation regulations in a variety of ways, according to the lawsuit.
It accuses Musk of wrongful behavior, claiming that his “false statements and market manipulation have generated chaos in Twitter’s San Francisco headquarters.”
Mr Musk’s $54.20 offer price for Twitter shares is roughly 27% cheaper.
Mr Musk allegedly benefited financially from delaying the disclosure of his considerable position in Twitter and his intention to join the company’s board of directors, according to the lawsuit.
It also alleged that other comments from Mr Musk, who has over 95 million followers on Twitter, were “misleading.”
It contained a post in which Mr Musk stated his offer for the social media company had been put on hold due to his concerns about the number of bogus accounts on the network.
According to the lawsuit, the message on May 13 “constituted an attempt to influence the market for Twitter shares since he knew about the bogus accounts.”
It further claimed that four days later, Mr Musk doubled down on his claims, saying on Twitter that the deal “cannot go forward.”
The case was launched as Mr Musk “continues to trash the company he wants to buy for $44 billion in an effort to renegotiate the purchase price,” according to Frank Bottini, one of the lawyers representing the Twitter investors, who told the BBC on Friday.
Mr Bottini added, “The complaint we filed in San Francisco seeks to hold Musk accountable for his unlawful behavior.”
Analysts suspect that Mr Musk is considering lowering his takeover bid or walking away from the deal altogether.
He has expressed alarm about the amount of false accounts, or bots, on Twitter on multiple occasions.
A bot is a software program that puts out automated postings on social media platforms and is frequently connected with disinformation.
Mr Musk has also intimated that he would try to negotiate a lower price for Twitter than the $44 billion he and the company’s board agreed on in March.