A federal jury in San Francisco has found Elon Musk liable for securities fraud after determining that he made false statements on social media in 2022 that artificially depressed Twitter’s stock price, enabling him to attempt to renegotiate or potentially abandon his $44 billion acquisition of the company.
The verdict, delivered on March 20, 2026, after a closely watched civil trial that began on March 2, concluded that Musk was responsible for two specific statements he posted on X (formerly Twitter) shortly after agreeing to buy the platform in April 2022. In one, he claimed the deal was “temporarily on hold” pending confirmation that fake and spam accounts (bots) represented less than 5% of users. In the other, he suggested the bot percentage could be “much” higher than 20% and that the takeover could not proceed unless Twitter’s CEO proved it was under 5%.
Jurors ruled these statements were materially false or misleading and that Musk acted with scienter (intent to deceive or recklessness). However, they rejected a broader claim that Musk engaged in a deliberate scheme to defraud shareholders.
Lead plaintiffs’ attorney Francis Bottini estimated potential damages could reach approximately $2.5 billion, covering investors who sold Twitter shares between May 13 and October 4, 2022 — the period when Musk’s statements allegedly depressed the stock price. Damages will be determined in a separate phase.
Musk’s legal team at Quinn Emanuel Urquhart & Sullivan called the verdict “a bump in the road” and vowed to appeal. “We look forward to vindication on appeal,” they stated in a joint release.
The case stems from shareholder class-action lawsuits filed after Musk repeatedly questioned Twitter’s bot numbers publicly while attempting to back out of the deal — ultimately completing the purchase in October 2022 after legal battles forced him to proceed.
The jury’s finding marks a rare civil liability outcome for Musk, who has previously prevailed in high-profile shareholder suits, including a 2023 San Francisco trial over his 2018 “funding secured” tweet about taking Tesla private and a Delaware case upholding his $139 billion Tesla compensation package.
Musk is separately negotiating a settlement with the U.S. Securities and Exchange Commission over allegations he delayed disclosing his initial Twitter stake purchases in 2022, allowing him to buy more shares at lower prices before public knowledge.
The verdict reinforces that high-profile public statements by corporate executives — particularly those capable of moving markets — carry significant legal responsibility under federal securities laws.
