Last Update: January 19, 2023, 07:40 AM IST
San Francisco, United States
Investors claim Musk’s tweet misled them and the stock market, resulting in huge losses (Image: Reuters)
Musk is expected to attend the test this Friday
An attorney for angry Tesla investors told a California court on Wednesday that the CEO Elon Musk “Lied” about having funding to take the company private, causing millions of dollars in losses for its customers.
More than four years after Musk dismissed tweets that he had the funds secured to buy the electric carmaker at $420 a share, investors infuriated by the misleading statements began making their case in a San Francisco court. .
Tweets made in the summer of 2018 sent Tesla share price on a rollercoaster ride and Musk is being sued by shareholders, who say the tycoon acted negligently in an effort to squeeze investors who had bet against the company Worked.
“Elon Musk, Tesla’s chairman and CEO, lied,” said Nicholas Porritt, the attorney representing Glen Littleton and other investors in the automaker.
“And their lies cost regular people like Glenn Littleton millions and millions of dollars in damages,” Porritt added in opening remarks.
Called as the first witness, 71-year-old Littleton told jurors that he was heavily invested in Tesla in 2018 to the point that the share price climbed to $500 or more.
Littleton testified that he was “quite surprised” by Musk’s tweet about taking the company private at $420 per share because it threatened almost all the money he had invested in Tesla.
“It will quite wipe me out,” said Littleton.
Lyttelton told jurors that he scrambled to save his investments “in a fog of war”, leaving most of his positions at heavy losses.
The fraud trial began on Tuesday with the selection of a nine-person jury, and is expected to last three weeks. Musk is likely to take the stand as early as Friday.
Musk denies he was a fraud and his lawyers are expected to call witnesses to his plans at the time, including testimony from Musk’s friend and fellow billionaire Larry Ellison.
‘Not Fraud’
The case revolved around a pair of tweets in which Musk said “funding secured” for a project to buy the publicly traded electric automaker, then said in a second tweet that “investor support confirmed”. Is.”
Porritt told jurors that Musk chose the $420 share price in the tweet “as a joke” and that funding to take Tesla private was never locked in, nor credibly pursued. Was.
Musk’s attorney Alex Spiro said in his opening remarks that even though the tweets may have been a “reckless choice of words,” they were “not a hoax, not even close.”
“What Mr. Musk was communicating in those tweets was that Mr. Musk was serious about taking Tesla private,” Spiro told jurors.
The test comes at a sensitive time for Musk, who has made headlines in recent months for his chaotic acquisition of Twitter, where the entrepreneur laid off more than half of its 7,500 employees and slashed content moderation.
Tesla’s share price has plummeted, with investors accusing Musk of spending too much time on Twitter, at a time when the car company faces new challenges, including a slowing economy and the arrival of new rivals in the electric car market. Is.
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(This story has not been edited by News18 staff and is published from a syndicated news agency feed)