Tesla CEO Elon Musk defended a 2018 tweet about taking the electric-car maker private in court, downplaying the impact his tweets had on the company’s stock.
“It’s hard to say that stock prices are linked to tweets,” he told jurors in San Francisco federal court on Friday. We will not act accordingly.”
Investors claim the tweet amounted to a lie and suffered heavy losses due to the dramatic 10-day stock price volatility before the plan was abandoned. The trial will require jurors to delve into Musk’s state of mind when he posted the message and determine whether the billionaire’s social media posts really influenced investors’ trading. When asked by a family lawyer if his tweets needed to be accurate, Musk replied that he provided “information for the public to hear,” but what the 240-character limit tells Twitter. is limited.
Mask appeared on the witness stand wearing a black suit and tie, removed his mask, and gave a short smile as if admitting to the jury.
During questioning, Musk appeared to show a friendlier side, telling jurors that 2018 was a “very painful and difficult year.”
“I was sleeping in the factory to make things work,” Musk said. “The level of pain that went into making Tesla a success in the 2017-2019 period was excruciating for me and many others.
He repeated the mantra that short-selling should be made illegal, telling jurors that short-selling wants stocks to fall and wants Tesla to “die badly.” In his opening statement, he told jurors that while his tweet was hasty and contained technical errors, it accurately conveyed that Musk was sincere in keeping Tesla private. Musk will testify that his short-term plan to take Tesla private has been solid, based on discussions with Saudi Arabia’s sovereign wealth fund.
The trial comes at a time when Musk’s fortune is declining from a peak of $340 billion in November 2021. Musk became the first person in history to lose more than his $200 billion, all the while spending his $44 billion to acquire his Twitter Inc. The world’s richest man, Tesla’s shares have plummeted 33% since December 1, as electric car makers face increased competition and a looming recession.
Musk is no stranger to court battles and has been nicknamed “Teflon Elon” for his ability to escape unscathed. He ran for and won trials in Los Angeles in 2019 and in Delaware in 2021. He also testified in November in a Delaware investor lawsuit over a $55 billion Tesla payment package, which has yet to be decided.
The CEO has tried to move this latest trial out of San Francisco, saying jurors in the region will likely be biased against him because of his recent Twitter layoff and “regional negativity.” claimed. U.S. District Court Judge Edward Cheng expressed his confidence that an “impartial” jury would be seated, pledging Tuesday at a nine-man panel.
Jurors have already heard from two Tesla investors who allege that Musk’s August 7, 2018 tweet prompted them to bet on the stock and ultimately suffered heavy losses.
Tim Fries, a shareholder and family man with three college-aged children, said Friday that the tweet prompted him to buy 50 shares the next day for $18,000.
“This is where Elon Musk told the world his plans to ‘secure the funding’ and take Tesla private. Given the stock price at the time, it felt like a good entry point.”
French fries lost $5,000 when the stock price fell. “I got involved in this lawsuit because I felt I had been wronged. I felt I lost money because of false representations,” Fries said. It added that the phrase “was made” meant that there was “some scrutiny of sources, some critical review.”
Professor Guhan Subramanian of Harvard University was subpoenaed as an expert witness by plaintiffs to testify about management’s traditional acquisition practices and procedures and its experience with the acquisition of Dell Inc.
He called Musk’s undisclosed proposal in some ways “incomplete,” “incoherent,” and “fantastic.”
“This is extremely out of place,” the professor said, adding that the idea of a deal of that size closing in 30 days was “impossible.”