September 26, 2022

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Twitter Investors Sue Elon Musk for Stock ‘Manipulation’ During Takeover Bid

World’s richest man, Elon Musk has been sued by Twitter Inc. investors, claiming he manipulated the company’s stock price downward when he mounted a $44 billion takeover bid for the social media platform.
The investors said billionaire Musk saved himself $156 million by failing to disclose that he had purchased more than five per cent of Twitter by March 14.

They asked to be certified as a class and to be awarded an unspecified amount of punitive and compensatory damages.

According to Reuters, they also named Twitter as a defendant, arguing the company had an obligation to investigate Musk’s conduct, though they are not seeking damages from the firm.

The investors said Musk continued to buy stock after that, and ultimately disclosed in early April that he owned 9.2 per cent of the company, according to the lawsuit, filed on Wednesday in San Francisco federal court.

“By delaying his disclosure of his stake in Twitter, Musk engaged in market manipulation and bought Twitter stock at an artificially low price,” said the investors, led by Virginia resident William Heresniak.

Neither Musk nor his lawyer immediately responded to requests for comment. Twitter declined to comment.

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