Closing arguments are set to begin on Tuesday in a civil trial where Twitter shareholders accuse Elon Musk of deceptive behaviour as he attempted to back out of his $44bn (£35bn) acquisition of the social media platform in 2022. The class-action lawsuit, filed in San Francisco just before Musk took control of Twitter—later renamed X—focuses on claims that the world’s richest man misled investors about the prevalence of bots on the platform.
Central to the case is Musk’s assertion that Twitter had far more fake and spam accounts than the 5% it disclosed in regulatory filings. Musk has argued that this misrepresentation gave him grounds to renege on the original deal, struck in April 2022 at $54.20 per share. At the time of the trial, Musk’s wealth was estimated at $839bn.
The trial has highlighted conflicting testimony over the bot count. Musk claimed that at least 20% of accounts were bots, calling it as obvious as “saying the grass is green”. In contrast, Twitter’s former chief financial officer, Ned Segal, testified that the figure was closer to 1% and that the company never filed false statements with the Securities and Exchange Commission (SEC). However, Segal acknowledged that Twitter had once restated its finances after overcounting daily users in 2017 due to improperly including third-party app users.
The issue of bots is not new for Twitter. In 2021, the company paid $809.5m to settle claims that it overstated growth and monthly user figures. Twitter had for years disclosed its bot estimates to the SEC while cautioning that the true number might be higher. Musk’s attempt to walk away from the deal led Twitter to sue him in Delaware, forcing him to complete the purchase just before that case went to trial.
On Monday, Judge Charles R. Breyer reviewed jury instructions and noted that many potential jurors held negative views of Musk. He emphasised that a person who is “not universally liked” still deserves a fair trial without discrimination or prejudice. The jury will now hear closing arguments before deliberating the case.
