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HomeAll NewsMost read newsBusiness Leaders Biography 
Birthday : 06/28/1971
Place of birth : Pretoria - South Africa
Linked companies : Tesla, Inc. - Twitter, Inc.
Biography : Mr. Elon R. Musk is a Chief Executive Officer at The Boring Co., a Technoking of Tesla at Tesla,...

Musk to return to stand in fraud trial over 2018 Tesla tweet

01/23/2023 | 07:14am EDT
Tesla CEO Elon Musk attends securities-fraud trial in San Francisco

(Reuters) - Tesla Chief Executive Elon Musk will take the witness stand again on Monday, as he defends himself against fraud claims that he lied when he tweeted in 2018 that he had funding to take the electric carmaker private.

Millions of dollars are at stake as well as the reputation of Musk, whose personal stature is a central asset of the Tesla brand. The trial will test whether Musk's penchant for taking to Twitter to air his sometimes irreverent views misleads investors and damages the value of the company.

The case is a rare securities class action trial and the plaintiffs have already cleared high legal hurdles, with U.S. Judge Edward Chen ruling last year that Musk's post was untruthful and reckless. Shareholders claim they lost millions after Musk tweeted that he had "funding secured" to take Tesla private.

Musk on Friday called Twitter, which he bought in October, the most democratic way to communicate but said his tweets did not always affect Tesla stock the way he expects.

"Just because I tweet something does not mean people believe it or will act accordingly," Musk told the jury in San Francisco federal court.

The billionaire is expected on Monday to address why he insisted he had Saudi investor backing to take Tesla private, which never occurred, and whether he knowingly made a materially misleading statement with his tweet.

Some outside trial lawyers have said he appears to have a thin skin and can be needled. But Musk on Friday spoke softly and in a sometimes bemused manner, a contrast to his occasional combative testimony in past trials.

Musk described the difficulties the company went through around the time he sent the "funding secured" tweet.

He was asked about messages sent to him by Tesla investor Ron Baron, who urged him to stop using Twitter, but Musk said he didn't recall and received thousands of messages.

He discussed the challenges the company faced at the time, including bets by short-sellers that the stock would fall.

"A bunch of sharks on Wall Street wanted Tesla to die, very badly," he said.

Musk's attorney, Alex Spiro, told the jury in his opening statement Wednesday that Musk believed he had financing from Saudi backers and was taking steps to make the deal happen. Fearing leaks to the media, Musk tried to protect the "everyday shareholder" by sending the tweet, which contained "technical inaccuracies," Spiro said.

A jury of nine will decide whether the tweet artificially inflated Tesla's share price by playing up the status of funding for the deal, and if so, by how much.

The defendants include current and former Tesla directors, whom Spiro said had "pure" motives in their response to Musk's plan.

(Reporting by Jody Godoy and Tom Hals; Editing by Noeleen Walder, Peter Henderson and Daniel Wallis)

By Jody Godoy and Tom Hals


© Reuters 2023
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