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Twitter Stakeholders Sue Elon Musk And Allege He Caused The Company's Stock To Plummet

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Twitter Stakeholders Sue Elon Musk And Allege He Caused The Company's Stock To Plummet

Elon Musk has been hit with a lawsuit over his bid to buy Twitter after shareholders accused him of manipulative behaviour for personal gain.

The suit was filed in the federal district court in San Francisco, according to The Verge.

The complaint alleges the SpaceX founder's behaviour was intentional after he struck an agreement to purchase the social media platform.

They claim his actions had the sole purpose of driving Twitter's share prices down.

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"Musk proceeded to make statements, send tweets, and engage in conduct designed to create doubt about the deal and drive Twitter’s stock down substantially in order to create leverage that Musk hoped to use to either back out of the purchase or re-negotiate the buyout price," legal documents claim.

The complaint continues: "As detailed herein, Musk’s conduct was and continues to be illegal, in violation of the California Corporations Code, and contrary to the contractual terms he agreed to in the deal."

The lawsuit also points to Musk's recent statement on the Twitter deal.

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The 50-year-old billionaire tweeted that the deal 'cannot move forward' until the current CEO provides data on bot accounts on the platform.

"20 per cent fake/spam accounts, while four times what Twitter claims, [the real number] could be much higher," Musk said.

"My offer was based on Twitter’s SEC filings being accurate."

The Verge reports the lawsuit is a proposed class action that has been put forward by a small group of shareholders.

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If won, the damages would be distributed amongst anyone holding Twitter stocks.

At time of writing, Twitter shares sat at $39.52 ($AU 55.66, £31.33) each. The deal struck between Musk and Twitter was agreed at $54.20 per share.

Musk's Twitter drama is just the latest in the billionaire's stock woes.

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Tesla stocks have plummeted nearly half their value since their peak in November last year following a tumultuous six months for Elon Musk's electric car company.

Stocks dropped by more than half a trillion dollars since November.

Tesla's massive loss comes in contrast to CEO Elon Musk's staggering personal high in November as his personal net worth surpassed $300 billion ($AU 422 billion, £239 billion).

This made Musk the first person in the world to achieve that level of wealth.

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Now, the Tesla CEO's worth has plummeted to a measly $209 billion ($AU 294 billion, £166 billion). 

Tesla's share price drop came days after Musk was forced to address claims he sexually harassed a SpaceX flight attendant during a private jet trip to London.

Featured Image Credit: REUTERS / Alamy Stock Photo. pumkinpie / Alamy Stock Photo.

Topics: Elon Musk, Twitter, News, Technology

Rachel Lang
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