A jury unanimously agreed that Musk didn’t intend to mislead investors when he said he was considering taking Tesla private.
As you may have been aware, Tesla CEO Elon Musk has been involved in a recent court case over a matter that happened several years ago. It was related to the outspoken CEO’s infamous, “taking Tesla private at $420” tweet.
For those who may be unaware, back in the late summer of 2018, Elon Musk tweeted that he was considering taking Tesla private at $420. The fact that he was simply “considering” the possibility really wasn’t an issue in the first place, since he never said he was doing it for sure. However, he did add the famous words, “Funding secured.”
Adding that he already had the funding surely made some investors jump to conclusions, but Musk never ended up taking Tesla private. It should come as no surprise that some investors got burned in a big way, and they blamed Musk’s tweet for their misfortunate. The US Securities and Exchange Commission (SEC) got involved as they have with Musk many times over the years, and the matter was set to go to court.
The SEC ruled that Musk was exaggerating his intentions and that it worked to mislead investors, especially since he claimed he already had the massive funding secured for the potential transaction.
Musk wasn’t happy with the SEC and actually went so far as to mock them and suggest that they were part of the problem. The CEO has made it clear on many occasions that he’s unhappy with the long list of people shorting Tesla, but not because they’re shorting the stock, but rather because some of them are seemingly part of a campaign to disseminate false bad news about Tesla and the CEO to drive the stock down. Musk made it seem as though the SEC may actually be siding with the Tesla short-seller community.
The CEO and the SEC settled the matter. Musk had to agree to step down as the chairman of Tesla’s board. Moreover, Tesla and the CEO each had to pay a $20 million fine. Due to the way in which Musk handled the payment of the fines, he ended up making money as Tesla’s stock price climbed. Musk also had to agree to a “Twitter sitter,” meaning he couldn’t send out “material” tweets without having them approved by someone else first.
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Musk has had to wait over four years to resolve the situation, and he seemed to go into the case with plenty of confidence. The CEO has said all along that he did, in fact, have the funding secured. He continued to claim that the investors that who promised the funds later backed out.
With all of that said, the jury in the recent case unanimously agreed that Musk was not liable for the investors’ loss of money. Needless to say, Musk seemed thrilled with the verdict.