Elon Musk to Testify Over Twitter Takeover Lawsuit

Billionaire entrepreneur Elon Musk is expected to take the witness stand on Wednesday in San Francisco in a shareholder lawsuit tied to his 2022 takeover of Twitter.

Musk used public statements to shake confidence in Twitter, drive the share price down, and give himself room to delay the deal or renegotiate the price before eventually buying the company for $44 billion.

What the lawsuit says

The lawsuit was filed in October 2022 at the U.S. District Court for the Northern District of California. It was brought on behalf of Twitter shareholders who sold their shares between May 13 and October 4, 2022, Months before the transaction closed.

These shareholders argue they were harmed because Musk’s comments allegedly pushed the stock down during that window.

Their central allegation is that Musk violated federal securities laws by making false and misleading statements that undermined market confidence in Twitter.

The suit puts it bluntly: Musk, they claim, made “materially false and misleading statements and omissions” to try to delay the merger or pressure Twitter into accepting a lower price.

The timeline that triggered the fight

Musk agreed in April 2022 to buy Twitter and take it private at $54.20 per share.

Then on May 13, 2022, he posted that the deal was “on hold temporarily” because of concerns about spam and fake accounts. Twitter’s shares fell after that.

In the days that followed, Musk escalated the issue further, tweeting that the deal “cannot go forward” and claiming nearly 20% of accounts were fake, far above Twitter’s public estimate of less than 5%.

The shareholders’ case argues that Twitter did not agree to an open-ended pause and that the merger agreement did not give Musk the right to freeze the deal the way he suggested publicly.

By July 2022, Musk said he was walking away entirely, arguing Twitter had not provided enough information about bots and fake accounts. The lawsuit counters that this stance was hard to justify because Musk had waived due diligence in his “take it or leave it” offer, meaning he gave up the right to demand deeper nonpublic checks before signing.

When Musk announced he intended to abandon the deal, Twitter shares closed at $36.81, about 32% below the agreed offer price of $54.20.

The bots issue wasn’t new

A major theme in the case is whether Musk’s bot claims were a genuine discovery or a tactical weapon.

The bot problem had long been part of Twitter’s public risk disclosures, and the company had warned regulators that its estimates had limits.

Twitter had also paid $809.5 million in 2021 to settle claims tied to overstating user growth, something the shareholders point to as evidence that bot and user-count controversies were already known issues, not sudden shocks.

How the deal ended anyway

On May 27, 2022, Twitter sued Musk to force him to complete the acquisition.

Then on October 4, 2022, Musk reversed course and agreed to go ahead with the original $44 billion deal. It closed later that month.

After taking control, Musk reshaped the company: he reduced the workforce, loosened content moderation rules, and later rebranded Twitter as X.

Why Musk’s testimony matters

Musk testifying is a big moment because the case is about intent, what he meant to achieve with those posts and public comments.

The plaintiffs want the court to believe the messaging was not just talk, but a deliberate strategy to pressure Twitter and move the market.

Musk is not new to the courtroom spotlight. In 2023, a jury cleared him in a separate case that accused him of misleading investors with social media posts during a failed 2018 attempt to take Tesla private.

And the legal scrutiny around X has continued. In November 2024, Bernard Arnault, head of luxury group LVMH, filed a lawsuit against X in Europe, accusing the platform of using content from his newspapers and other French publications without paying, under a 2019 EU directive requiring platforms to negotiate compensation for reusing news content.