Follow Verum News on Twitter
Judge dismisses shareholder class action lawsuit against Elon Musk over Twitter buyout. The plaintiff was unable to prove his allegations and had no right to sue.
A judge has dismissed a proposed class action lawsuit against Elon Musk alleging he cheated Twitter shareholders several times last year in a $44 billion purchase of the social network, according to Reuters. In a decision made on Monday, U.S. District Judge Charles Breyer in San Francisco said plaintiff William Heresniak lacked standing to sue because he challenged “wrongs associated with” Musk’s buyout, not the fairness of the buyout itself.
Breyer said Heresniak did not show harm from Musk’s belated disclosure of a 9.2% Twitter stake, which the suit said let him buy more shares at lower prices before the buyout was announced, or from the closing’s taking place one and a half months later than planned.
In addition, the judge also found no evidence that Musk helped then on Twitter’s board, co-founder Jack Dorsey and Silver Lake private equity firm managing partner Egon Durban, breach their fiduciary duties by prioritizing their own interests and those of Musk. Breyer said letting Dorsey roll over his approximately $1 billion of Twitter shares into an equity stake in the new company merely reduced how much Musk had to pay at closing, and did not “improperly divert” money from other shareholders.
Heresniak filed a lawsuit on May 25, 2022. The deal closed on October 27.
Verum News 