Elon Musk stood as a witness on Friday to defend a 2018 tweet that claimed he was financially prepared to take Tesla private in a deal that never happened.
The tweet led to a $40 million settlement (approximately Rs 323 crore) with securities regulators. It also led to a class action lawsuit accusing him of defrauding investors, dragging him to court for about half an hour on Friday to give sworn testimony before a nine-person jury and the entire media and other audiences.
The trial was then adjourned for the weekend and musk was asked to return on Monday to answer more questions.
During his first appearance in the stands, Musk defended his prolific tweet as “the most democratic way” to distribute information even while acknowledging the limitations of Twitter’s 240-character limit can make everything as clear as possible.
“I think you can totally be honest (on Twitter),” Musk asserted in the stands, “But can you be comprehensive? Of course not,”
Musk’s latest headache stems from the brevity inherent on Twitter, a service he has run since completing a $44 billion (about Rs 3,56,300) purchase in October. ten.
The trial revolved around the question of whether a pair of tweets Musk posted on August 7, 2018 was damaged. Tesla shareholders over a 10-day period that led to Musk admitting that the buyback he envisioned would not happen.
In the first of those two 2018 tweets, Musk announced “guaranteed funding” of a $72 billion Tesla acquisition (about Rs 5,83,100) at the time the electric carmaker is still struggling with production issues and is worth much lower than it is now. Musk followed up a few hours later with another tweet suggesting an impending deal.
After it became clear that the money wasn’t enough to make Tesla private, Musk resigned as chairman of Tesla while remaining CEO as part of a Securities and Exchange Commission settlement without redundancies. accept any wrongdoing.
The impulsive billionaire arrived in court in a dark suit and tie on the third day of a civil trial in San Francisco that his attorney had tried to move to Texas, where Tesla is currently headquartered, with The reason was that the media reported on his takeover of the company in a chaotic manner. Twitter has smeared the jury.
The jury assembled earlier this week focused intently on Musk while he answered questions posed by Nicholas Porritt, an attorney representing Tesla shareholders. At one point, Musk asked Porritt if he could speak closer to the microphone so he could hear better. At other times, Musk craned his neck as he looked around the courtroom.
Musk, 51, said he cares “a lot” about investors and also opposes short sellers, who make investments that give them returns when a company’s share price falls. . He called short selling a “evil” practice that should be outlawed, and branded those who profited from it as “a bunch of sharks.”
When shown communications from Tesla investors urging him to cut back or completely stop using Twitter before his 2018 acquisition tweet, Musk said he couldn’t remember them all. those interactions from years ago, especially since he received the “Niagara Falls” email.
Even before Musk took a stand, U.S. District Judge Edward Chen stated that jurors could consider those two tweets untrue, allowing them to decide whether Musk intentionally misled the judges. investment and whether his claims will cause them to incur losses.
Musk has previously argued that he entered into the SEC settlement under duress and asserted that he believes he locked away financial support for the Tesla acquisition during meetings with representatives. from the Public Investment Fund of Saudi Arabia.
A corporate acquisition expert hired by a shareholder attorney to research the events surrounding Musk’s proposal to take Tesla private spent most of his three hours in the stands on Friday watching. This plan is a misconception.
“This proposal is a very strange one,” said Guhan Subramanian, a Harvard professor of law and business for more than 20 years. It’s not coherent. It is an illusion.”
In a lengthy cross-examination that delayed Musk’s arrival, an attorney for Tesla’s board of directors tried to undermine Subramanian’s testimony by pointing out that they relied on the student’s support. recent graduate to review some documents related to the tweets in August 2018. The attorney, William Price, also noted Subramanian’s $1,900 per hour (approximately Rs 1,53,900) fee for compilation. compose his report for the case.
Testing of his Tesla tweets comes at a time when Musk is focusing on Twitter while also serving as the automaker’s CEO and also still deeply involved in SpaceX, the rocket ship company run by the company. he founded.
Musk’s leadership of Twitter – where he gutted employees and alienated users and advertisers alike – proved unpopular with existing Tesla shareholders, who worried that he had spent less more time to run the automaker at a time of intense competition. Those concerns contributed to a 65% drop in Tesla shares last year, wiping out more than $700 billion (about Rs 56,68,900 crore) in shareholder wealth – far more than $14 billion (roughly Rs. Rs 1,13,400) in fortunes that occurred between the high and low share prices of the company between August 7 and 17, 2018 mentioned in the class action.
Tesla’s shares have split twice since then, making the redemption price of $420 (roughly Rs 34,000) quoted in his 2018 tweet worth $28 (about Rs 2,300) on an adjusted basis. Currently. The company’s shares traded around $133.42 (roughly Rs 10,800) on Friday, down from the company’s November 2021 split-adjusted peak of $414.50 la (about Rs 33,600).
After Musk abandoned his intention to buy Tesla, the company fixed production problems, leading to a rapid increase in auto sales that sent the company’s shares soaring and made Musk the richest person in the world. until he bought Twitter. Musk dropped from the top spot on the wealth list following a stock market backlash over his handling of Twitter.
Asked on Friday about the challenges Tesla faced in 2018, he recalled spending many nights sleeping at the automaker’s California plant as he struggled to keep the company afloat.
“How difficult it was to make Tesla successful between 2017 and 2018 was enormous,” he recalls.
