Twitter investors sue Elon Musk for market manipulation

Tesla CEO Elon Musk has been sued by Twitter shareholders for his actions during the acquisition of the social media platform.

Video version

Jared Blaker: welcome back. Twitter shareholders are suing Elon Musk, as well as Twitter itself, for market manipulation over the course of the acquisition between Musk and Twitter. And for more information on this topic, we’d welcome Dan Howley of Yahoo Finance. Dan, first and foremost, I have to give you credit for correctly locating the George Washington Bridge. Julie, I think we lost Dan Hawley here.

Julie Hyman: Oh, no, did we miss Dan Hawley, guys? Well, we lost Dan Hawley?

Jared Blaker: that happens.

Julie Hyman: OK, are we going back to Dan Howley, or should we talk about Twitter for a minute? Well, let’s talk about that. So, first of all,

Jared Blaker: Breaking news too.

Julie Hyman: The Securities and Exchange Commission is looking into Elon Musk’s disclosure of his stake in Twitter. This isn’t shocking, is it? I mean, reveal –

Jared Blaker: They had to.

Julie Hyman: They had to. Now, the question is, are they going to do anything about it? And I think there’s broad skepticism about their abilities – Dan, there’s some broad skepticism about the SEC’s ability to actually narrow. But there’s also a lawsuit in place here for some of the shareholders. Did Dan bring us back? there he is.

Dan Holly: Yes I am here. Sorry about that guys. yes.

Julie Hyman: do not worry.

Dan Holly: There is a lawsuit that a group of shareholders are seeking to obtain class action status. And what they’re basically saying is that Elon Musk has broken California corporate laws. Part of that has to do with the timing he disclosed his Twitter stake is basically that he didn’t disclose it in time, and in doing so, he was able to get a discount on subsequent stock purchases, rather than the inflated price he would have seen if he had disclosed His initial stake earlier. That’s because people will see Elon Musk buy to Twitter and then immediately think, OK, we should also buy because something is going on here. That’s part of the problem there.

But that’s not the only thing Elon Musk is dealing with. The Securities and Exchange Commission is also looking into its disclosures on his early stake. This is according to Reuters, which had reported this a little less than an hour ago. It is clear then that we have problems with the constant fluctuations in the price of the stock itself. Now that’s also part of this proposed California lawsuit. They say that because of his hoaxes, let’s just say hoaxes, Twitter’s stock price suffered as a result. Not much at Tesla, but that’s not part of that suit.

He basically says he’s hanging on, that he’s still loyal to her, wondering how many bots there are, kind of talking negatively to the CEO. This, they say, is part of the bigger problem Elon Musk has with Twitter. And that appears to be their opinion here of this proposed lawsuit.

There are also these comments he keeps posting on Twitter that don’t necessarily relate to this lawsuit, but don’t really look good for Twitter in general. He did a poll recently asking whether or not people trust politicians more than billionaires. Elon Musk obviously has a huge following, I mean basically they are bigots and voted for billionaires.

You know, I don’t know of two other categories that people might want to compare in this way. Most people do not trust either of them. But I think that’s part of a bigger problem with Elon Musk and Twitter here and whether or not he’s going to get it in the end. But, you know, he seems to be on the right track to do it. Twitter will upload it.

Julie Hyman: It doesn’t look that way. I wonder how the SEC would score on this particular survey, especially if you asked Musk’s followers. Whew. Well, thank you very much, Dan Hawley. I wish you a nice week-end.

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