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Musk's compensation could reach 3.8 trillion won... Claims related to cannabis slang '420' also rejected
The court upheld the jury's verdict that Elon Musk deceived investors while acquiring the social networking service (SNS) Twitter (now X).
Judge Charles Breyer of the U.S. District Court for the Northern District of California on the 6th (local time) denied Musk's request to invalidate the jury's verdict.
Previously, the jury found that Musk had intentionally misled investors to drive down the stock price after agreeing to a $44 billion Twitter acquisition deal.
Shortly after expressing his intention to acquire Twitter, Musk posted a tweet on May 13, 2022, stating that he would put the acquisition on hold until he could confirm the proportion of fake accounts on Twitter, which caused Twitter's stock price to plummet by 18% over two days.
Musk then posted another tweet on the 17th of the same month, stating that the acquisition could not proceed.
Afterward, Musk declared the termination of the contract in July of that year, claiming that Twitter did not provide account information properly, but completed the acquisition of Twitter just three months later in October.
Musk argued during the trial that his tweet to put the investment on hold was not false, but the court rejected this, citing that Musk had never instructed to stop transaction-related work.
Judge Breyer pointed out, "Even if one changes their mind about a deal or feels momentary regret, such anxiety does not justify lying to the investing public."
However, the court applied this fraud charge only to the tweet on the 13th and did not acknowledge Musk's responsibility for investor losses regarding the tweet on the 17th, as market reaction was not confirmed at that time.
In particular, Musk's side argued that the entire verdict should be invalidated, claiming that the jury mocked him by writing only the part of the damages amount as '$4.20' in blue in the verdict, but the court did not accept this.
Musk has habitually used the number 420, such as proposing an acquisition price of $54.20 per share during the Twitter acquisition and mentioning $420 per share during the 2018 Tesla delisting commotion.
However, the court found Musk's argument to be against common sense, noting that the jury's deliberation period was four days and that some claims favored Musk.
Regarding the expression '420' itself, the court pointed out that it is a reference to cannabis/marijuana and cannot necessarily be seen as a mockery of Musk, nor did Musk's side provide evidence of mockery, and that the jury had also written other parts of the verdict in blue.
The plaintiff's legal representative previously stated that Musk's damages from this trial would amount to approximately $2.5 billion (approximately 3.8 trillion won).
In addition to this trial, Musk is also being sued by investors in connection with allegations that he acquired shares at a bargain price by belatedly disclosing initial investment facts.
Twitter, acquired by Musk, changed its name to X and was later acquired by the artificial intelligence (AI) company xAI, which was recently incorporated as a subsidiary of SpaceX.
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