A certified class made up of Twitter investors who sold the publicly traded stock or call options or purchased put options of Twitter between 13 May 2022 and 4 October 2022 sued Elon Musk for alleged market manipulation. The investors claimed Mr. Musk made three false or misleading statements about Twitter’s fake “bot” accounts problem in a bid to drive down the company’s stock price, in the hopes of allowing him to renegotiate or back out of the $44 billion deal to acquire the social media platform in 2022. Investors claimed that in the absence of Mr. Musk’s statements, they would not have sold their shares at “artificially depressed prices” or they would not have sold them at all.

Senior Managing Director David Tabak was retained by the investors’ attorneys to estimate how much Musk’s statements affected the share price during the class period. Dr. Tabak provided testimony on market efficiency for the stock and options (resulting in class certification under the fraud-on-the-market theory) and provided trial testimony on market efficiency and per-share deflation based on an event study and per-option inflation and deflation based on an application of the Black-Scholes option-pricing formula.

On 20 March 2026, a California federal jury found Elon Musk liable for securities fraud. In a unanimous verdict, the jury adopted all of Dr. Tabak’s daily inflation and deflation figures for Twitter’s shares and options for the statements for which it found Mr. Musk liable. Individual and aggregate damages have yet ​to be calculated, but a lawyer for the investors estimated the damages the jury awarded in the case would amount to about $2.6 billion.