Elon Musk Testifies He Paid Full $44 Billion for Twitter Citing Bias by Delaware Judge
San Francisco: Elon Musk told jurors that he agreed to pay the full $44 billion to acquire Twitter Inc. in 2022 after being advised that he was unlikely to prevail in court, alleging bias from the Delaware judge overseeing the case.Testifying at a trial in San Francisco that is revisiting the turbulent takeover, Musk said his legal team warned him that the presiding judge in the lawsuit brought by Twitter to compel completion of the deal was “extremely biased” against him. The case had been filed in the Delaware Chancery Court.
Musk Says Legal Advice Left Him With “No Choice”
The lawsuit was overseen by Chief Judge Kathaleen St. J. McCormick, who issued multiple rulings favoring the company before the trial. Musk testified that his lawyers believed the court would rule against him, leaving him with no viable option but to proceed with the acquisition at the agreed price.This marks the first time Musk has publicly detailed why he stepped back from contesting the $44 billion deal after initially seeking to withdraw. He had previously criticized McCormick but had not elaborated in sworn testimony until now.
A representative for the Delaware court did not immediately respond to a request for comment regarding Musk’s claims of judicial bias.
Investors Allege Share Price Manipulation
The ongoing trial centers on claims by Twitter investors who allege that Musk defrauded them by manipulating the company’s share price through critical posts about the platform in 2022. According to the plaintiffs, those statements were aimed at securing more favorable terms for the acquisition.On the witness stand, Musk rejected that characterization. He told jurors that his posts were expressions of personal opinion and minimized their impact on the company’s market valuation.
Broader Legal Clashes in Delaware
In a separate matter, Judge McCormick twice invalidated a compensation package awarded to Musk by Tesla Inc.. The pay package, originally agreed to in 2018, had set a record for executive compensation in the United States. It was later reinstated in December by the Delaware Supreme Court.Following McCormick’s ruling against him in the Tesla compensation case, Musk moved Tesla’s incorporation from Delaware to Texas. Delaware has long served as the corporate domicile for more than 60 percent of Fortune 500 companies.
Other companies, including Dropbox and Tripadvisor, also relocated their incorporation from the state.
In response to such departures, Delaware enacted new legislation aimed at granting controlling shareholders greater flexibility under its corporate laws, seeking to protect its status as a leading incorporation hub.
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