Two tweets. Eighteen percent off the stock price. Up to $2.6 billion in shareholder damages.

A nine-person federal jury in San Francisco ruled Thursday that Elon Musk misled Twitter investors with statements made in May 2022, deliberately driving down the company’s share price in the months before he completed his $44 billion acquisition. The verdict in Pampena v. Musk marks a rare courtroom loss for the world’s richest person — though the jury drew careful lines around what it found and what it didn’t.

What Stuck, What Didn’t

The jury held Musk liable on two specific tweets. The first, and most consequential, came on May 13, 2022, when Musk declared the Twitter deal was “temporarily on hold” pending verification of spam and bot account data. Hours later, he posted that he remained committed to the acquisition. The following Monday, he suggested that up to 20 percent of Twitter’s users could be bots — far exceeding the company’s disclosed figure of roughly 5 percent.

Between those posts, Twitter’s stock dropped nearly 18 percent, according to plaintiffs’ attorney Mark Molumphy. Shareholders who sold during the turbulence — believing the deal might collapse — locked in losses they would not have suffered had they held to the eventual buyout at $54.20 per share.

But the jury stopped short of finding intentional fraud. It absolved Musk of “scheming” to defraud investors, and found him not liable for comments made on a podcast during the same period. The distinction matters: misleading statements and deliberate fraud carry different legal weight, and the narrower finding may shape both the damages calculation and any appeal.

The Money

The jury awarded shareholders between roughly $3 and $8 per share per day during the period of the misleading statements. In a class action involving thousands of plaintiffs — many of them institutional investors — the total adds up quickly. Plaintiffs’ attorneys have estimated damages at approximately $2.1 billion, with a ceiling as high as $2.6 billion.

For Musk, whose net worth sits at approximately $814 billion, the figure is not existential. It is, however, consequential in a way that extends beyond his bank account. Securities fraud verdicts against individual executives — as opposed to corporate entities — remain uncommon. A jury telling the world’s richest man that his tweets moved markets and that he is financially responsible for the damage sets a marker.

The Bot Defense

Much of the three-week trial, which began March 2, turned on whether Musk’s public statements about Twitter’s bot problem reflected genuine concern or strategic maneuvering. Musk testified that he was “flabbergasted” when Twitter’s then-CEO Parag Agrawal and CFO Ned Segal could not explain the methodology behind their spam account estimates.

Defense attorney Michael Lifrak argued the tweets reflected real frustration, not market manipulation. He noted that Musk “never asked directly for a discount on the purchase” — the implication being that if the goal was to drive down the price for personal gain, the plan had no payoff mechanism. Musk ultimately completed the acquisition at the original $54.20 per share after Twitter sued in Delaware to enforce the agreement.

Plaintiffs’ counsel saw it differently. Molumphy told the jury that Musk “trashed the company, he trashed the executives and he tanked the stock,” calling the damage to shareholders indisputable. “There can be no dispute that Mr. Musk’s tweets caused this loss, caused this drop,” he said.

What Comes Next

The verdict opens a damages determination phase, where the precise payout to each class member will be calculated. Appeals are all but certain given the stakes. The case, originally filed in October 2022 shortly after Musk closed the Twitter acquisition, has already survived years of procedural challenges to reach a jury.

The legal distinction the jury drew — liable for misleading investors, but not for scheming against them — will be the fulcrum of any appellate argument. Musk’s team will push on the absence of intent; plaintiffs will argue that the effect on shareholders was real regardless of the motive.

For securities law, the precedent is worth watching. Individual liability for social media posts that move stock prices has been debated since Musk’s 2018 “funding secured” tweet about Tesla. This time, a jury put a dollar figure on it.

Sources