Photo: Elon Musk via Twitter
A jury has found Elon Musk not liable for investors’ losses in a security fraud trial over his 2018 “Funding secured” tweet. Musk then said he is considering taking Tesla private at $420 a share, a statement that a judge ruled was false.
It was a week full of good news for Tesla, following in the footsteps of the Q4 2022 earnings call. Elon Musk has approved the beta prototype of the Cybertruck, and we’ve also got a glimpse at the upcoming electric pickup truck. The Tesla Model S proved a cold-weather range champion in Norway, and demand for Tesla models soared, prompting a production ramp at Giga Shanghai.
Tesla is also getting closer to cracking the dry battery electrode process, making Li-Ion batteries more affordable. Last but not least, the IRS reconsidered the classification of the Tesla Model Y, making all trims eligible for the IRA tax credits. This couldn’t end better than with the news that Elon Musk is off the hook for defrauding investors in the infamous “Funding secured” trial.
Plaintiff Glen Littleton and other investors sued Musk and Tesla over the 2018 tweet and Musk’s subsequent statements. They said that the notion that financing was in place was false and constituted fraud, causing them to lose money. On the other hand, Musk’s attorney Alex Spiro argued that Musk’s tweet did not constitute the entirety of what was disclosed about the matter. Even if not necessarily accurate, the tweet did not constitute fraud.
The jury sided with Musk, despite his seeking to relocate the trial from California for alleged negative bias. According to Musk’s tweet following the verdict, the jury was unanimous in finding his “innocence in the Tesla 420 take-private case.” The judgment is even more important considering the judge earlier ruled that Musk “recklessly made the statements with knowledge as to their falsity.”
Musk sat for testimony over three days in January, saying that his tweets were not comprehensive about the matter. Musk also said that not everyone believes what he says when he posts. The funding was indeed secured because Musk owns a large stake in SpaceX. His position was that a meeting with the Saudi Public Investment Fund (PIF) ended with a commitment to take Tesla private, although the parties never settled on a deal.
In closing arguments, Musk’s attorney Alex Spiro urged jurors to make a firm judgment on the materiality of the tweet. He admitted that Musk’s tweet may have been “technically inaccurate,” but the case is about his consideration of taking Tesla private. “Just because it’s a bad tweet, doesn’t mean it’s fraud,” Spiro argued.
The plaintiffs’ attorney asserted that Musk’s behavior constituted fraud and that he should be subject to rules like anyone else. Nevertheless, the jury was not convinced by the argument. After a two-hour deliberation, which can be considered very quick, they delivered the verdict, clearing Musk of fraud accusations.
According to Washington Post, one of the jurors said that plaintiffs’ case often seemed disorganized. “I think the defense did a better job presenting that he was presenting what he believed to be true,” one of the jurors told the newspaper. He added that the plaintiffs’ overall message “didn’t land.” The verdict allowed Musk to walk away unscathed from what looked like a difficult trial. Musk could’ve been liable for billions of dollars in damages if found guilty.
Tesla is also getting closer to cracking the dry battery electrode process, making Li-Ion batteries more affordable. Last but not least, the IRS reconsidered the classification of the Tesla Model Y, making all trims eligible for the IRA tax credits. This couldn’t end better than with the news that Elon Musk is off the hook for defrauding investors in the infamous “Funding secured” trial.
Plaintiff Glen Littleton and other investors sued Musk and Tesla over the 2018 tweet and Musk’s subsequent statements. They said that the notion that financing was in place was false and constituted fraud, causing them to lose money. On the other hand, Musk’s attorney Alex Spiro argued that Musk’s tweet did not constitute the entirety of what was disclosed about the matter. Even if not necessarily accurate, the tweet did not constitute fraud.
The jury sided with Musk, despite his seeking to relocate the trial from California for alleged negative bias. According to Musk’s tweet following the verdict, the jury was unanimous in finding his “innocence in the Tesla 420 take-private case.” The judgment is even more important considering the judge earlier ruled that Musk “recklessly made the statements with knowledge as to their falsity.”
Musk sat for testimony over three days in January, saying that his tweets were not comprehensive about the matter. Musk also said that not everyone believes what he says when he posts. The funding was indeed secured because Musk owns a large stake in SpaceX. His position was that a meeting with the Saudi Public Investment Fund (PIF) ended with a commitment to take Tesla private, although the parties never settled on a deal.
In closing arguments, Musk’s attorney Alex Spiro urged jurors to make a firm judgment on the materiality of the tweet. He admitted that Musk’s tweet may have been “technically inaccurate,” but the case is about his consideration of taking Tesla private. “Just because it’s a bad tweet, doesn’t mean it’s fraud,” Spiro argued.
The plaintiffs’ attorney asserted that Musk’s behavior constituted fraud and that he should be subject to rules like anyone else. Nevertheless, the jury was not convinced by the argument. After a two-hour deliberation, which can be considered very quick, they delivered the verdict, clearing Musk of fraud accusations.
According to Washington Post, one of the jurors said that plaintiffs’ case often seemed disorganized. “I think the defense did a better job presenting that he was presenting what he believed to be true,” one of the jurors told the newspaper. He added that the plaintiffs’ overall message “didn’t land.” The verdict allowed Musk to walk away unscathed from what looked like a difficult trial. Musk could’ve been liable for billions of dollars in damages if found guilty.
Thank goodness, the wisdom of the people has prevailed!
— Elon Musk (@elonmusk) February 3, 2023
I am deeply appreciative of the jury’s unanimous finding of innocence in the Tesla 420 take-private case.
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