The richest man in the world is trying to get a discount.
In a new lawsuit, shareholders are accusing Musk of manipulating the price of the company's stock for his own benefit in the course of agreeing to buy the company. The lawsuit would allow any shareholders to receive financial compensation.
The suit claims that Musk drove down the company's stock in order to get a better deal.
Musk's decision to waive due diligence as a condition of the acquisition was cited in the lawsuit.
At the time, Musk was aware that there was a lot of fake accounts and accounts that were controlled by people.
Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of usershttps://t.co/Y2t0QMuuyn
— Elon Musk (@elonmusk) May 13, 2022
Many people observed at the time that Musk was trying to get a discount by casting doubt on his commitment to the company. Since Musk's initial commitment to purchase the company was announced, tech stocks have taken a dive.
The suit alleges that following Musk's comments, the company's shares dipped significantly.
There was no formal mechanism in place to back up Musk's claim that the deal was on hold. The company leaders encouraged employees to continue as though nothing had changed, noting that there was a binding agreement to buy the company.
The suit claims that Musk was able to buy shares at a discount because he delayed filing a disclosure form when his stake exceeded 5%. After the form was filed and Musk's purchases became public knowledge, the stock price of the social network soared.
Musk's disregard for securities laws shows how one can flaunt the law and the tax code to build their wealth at the expense of the other Americans, according to the complaint.
Twitter stock jumps on news that Elon Musk still wants to buy it … maybe
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