Remember last year when Elon Musk was going around pretending that Twitter Inc. was doing a whole assortment of fraud, hoping that some of it would stick so that he could get out of his deal to buy Twitter? That was annoying. It did not go well, for him, and he eventually dropped it and bought Twitter at the price he had originally agreed to. But if you go around telling everyone that a US public company is committing all sorts of fraud, then some securities lawyers are definitely going to sue the company for that alleged fraud, and they definitely did.
And now Musk owns the company and has to defend that fraud suit — hard, given that he has previously claimed to agree with it! — or else pay damages — unfair, since, in the somewhat imaginary world in which Twitter was doing a bunch of fraud, Musk is the biggest victim of that fraud! On the fraud theory of Twitter, Twitter was doing a bunch of fraud that propped up its stock price, and then Musk agreed to buy it at a premium to that inflated price, and then the fraud was disclosed, and then Musk grumbled but bought it anyway at that inflated premium price, and now the shareholders who sold get to sue him for more money? Seems very unfair, and yet somehow hilariously deserved.
Source: Oh Elon – Bloomberg
