Elon Musk begins trial over Tesla tweet that cost him $20mon January 17, 2023 at 2:26 pm

- Advertisement -
- Advertisement -
- Advertisement -
- Advertisement -

Shareholders are suing the Tesla CEO over a 2018 tweet saying he had the funds to take the firm private.

Photo of Elon MuskImage source, Getty Images

A trial into a tweet by Elon Musk alleging that he would take Tesla private in a $72bn (£58.7bn) buyout is set to begin on Tuesday.

Mr Musk is being sued by Tesla shareholders, who say that he manipulated the share price of the company.

In 2018, he tweeted that he had “funding secured” to take the carmaker private.

However the funding was not secured – and Tesla was not taken private.

Shareholders argued that they lost billions of dollars due to the tweet after the share price plummeted.

The Tesla CEO, however, argued that he believed he had secured funding from Saudi Arabia’s Investment Fund, and did not commit securities fraud.

If a San Francisco jury rules in the shareholder’s favour, Mr Musk may be ordered to pay billions of dollars in damages.

He has already paid $20m to the Securities Exchange Commission (SEC) for the 7 August 2018 tweet, while Tesla had to pay another $20m.

The SEC also removed Mr Musk as chairman of Tesla as a result of the tweet.

The BBC is not responsible for the content of external sites.View original tweet on Twitter
Presentational white space

His tweet has become legendary in Silicon Valley, as it showed the sheer power that 140 characters on Twitter can have.

Legal experts said they believe it will be a difficult case for Mr Musk to win, and that the fine he paid to the SEC will be used against him in the case. However jury trials in cases of fraud are notoriously difficult to predict.

Mr Musk had wanted the trial to be moved to Texas, arguing a fair jury would not be possible to find in San Francisco.

He argued that mass sackings at Twitter, a company he bought last year, affected many employees in San Francisco – and that he is not popular in the city.

Mr Musk’s team had argued that a significant majority of potential jurors said they viewed the billionaire negatively.

However, the judge said the trial would go ahead in California.

The trial may see Mr Musk give evidence under oath. The witness list also includes Oracle’s CEO Larry Ellison and media tycoon James Murdoch.

- Advertisement -




A Man of Opposites by Khalid Rashid

"A Man of Opposites" is a well-written memoir by Khalid Rashid, that contains true stories that will make you feel as if you have...

McColgan breaks Radcliffe’s 21-year-old British half-marathon recordon February 19, 2022 at 12:38 pm

Eilish McColgan breaks Paula Radcliffe's 21-year-old British half marathon record with a stunning run at Ras Al Khaimah in the United Arab Emirates.

Festive sport in Wales to be held without crowds to combat Omicronon December 21, 2021 at 12:00 am

Festive sport in Wales will be held behind closed doors from 26 December as the Welsh government combats Covid-19's Omicron variant.

Zelensky asked if he’ll give Russia any part of Ukraineon April 11, 2022 at 9:27 am

Ukraine's president tells CBS' 60 Minutes he isn't ready to give away his country in return for peace.

‘Legend’ Pele synonymous with football – Gary Linekeron December 29, 2022 at 7:30 pm

BBC Match of the Day presenter and former England star Gary Lineker says Pele was a "legend" of football, and was "synonymous" with the...