- Elon Musk’s trial over his 2018 tweets about Tesla kicked off in San Francisco last week.
- The suit revolves around tweets wherein Musk said he had “funding secured” to take Tesla private.
- The civil lawsuit is in search of unspecified damages but investors say the tweets cost them billions.
Elon Musk’s trial over four-year-old tweets about Tesla kicked off in San Francisco last week.
Musk and other Tesla directors are facing a class-action lawsuit from shareholders over 2018 tweets wherein he said he had “funding secured” to take Tesla private at $420 a share.
The deal never happened and now investors are suing Musk, saying he manipulated Tesla’s share price.
The civil suit, brought by Tesla investors who owned stock from August 7 to 17, is in search of unspecified damages, but investors have said the tweets cost them “billions.”
In April, the judge presiding over the case ruled that Musk’s 2018 tweets were “false and misleading,” per Reuters. The court “held that he recklessly made the statements with knowledge as to their falsity,” the news outlet reported.
The Securities and Exchange Commission (SEC) already reached a settlement with Musk and Tesla in a separate suit over the tweets.
Musk and Tesla each agreed to pay $20 million price of fines to settle the suit. Musk also agreed to step down as chair of Tesla’s board and have his tweets about Tesla reviewed by other company executives. He never admitted to the allegations and later said the fantastic was “price it.”
The SEC’s investigation found that while Musk had met with Saudi Arabia’s sovereign wealth fund, he “had never discussed a going-private transaction at $420 per share with any potential funding source,” court documents say.
Musk’s legal team originally tried to get the shareholder trial moved out of San Francisco, citing “local negativity” amid Musk’s highly publicized Twitter takeover. The request was denied by a judge and Musk took the stand on Friday, where he appeared to suggest his tweets weren’t that significant to Tesla’s stock price.
“Simply because I tweet about something doesn’t suggest people consider it or will act accordingly,” he said.
Representatives for Musk didn’t immediately reply to Insider’s request for comment.