Four and a half years ago, Elon Musk, on his way to the airport, posted on his Twitter page a statement of intent to buy back shares of the company he leads for $420 apiece, backing it up with a message that he had the necessary funds for this. Since the deal ultimately did not take place, and the investors suffered losses, Musk had to answer for this in court, but the jury found him innocent.
Image Source: Benjamin Fanjoy, Bloomberg
On Friday, according to Bloomberg, it took no more than two hours for a jury in San Francisco to acquit Elon Musk in a 2018 tweet in which he announced intentions to privatize Tesla. The charges brought by the affected investors were dropped. This was the next success of the lawyer Alex Spiro (Alex Spiro), who in recent years has been handling all the cases of Elon Musk. In 2019, he managed to get the billionaire acquitted in the case of insulting a British lifeguard within an hour and a half.
Hearings in the case of the failed privatization of Tesla lasted three weeks. In 2018, Elon Musk abandoned his intentions to buy back shares of the company two weeks after his scandalous statements. During this time, many investors managed to invest in the company’s shares, counting on their further growth in price before privatization, but eventually lost their money. However, US stock market regulators still forced Musk to pay a $20 million fine and ordered him to coordinate public statements regarding Tesla’s business with lawyers. In addition, Musk had to leave the post of chairman of the board of directors of this company for some time. The billionaire paid another $ 20 million as compensation for the fine imposed on Tesla itself.
Nicholas Porritt, a lawyer representing the affected investors, said: “We are disappointed with the outcome of the case and are considering next steps.” According to Alex Spiro, who defended Musk, “the jury made the right decision.” The defense side insisted that before Elon Musk made his statement about the availability of funding sources for the repurchase of Tesla shares, he met with the leadership of the Saudi Arabian investment fund and the Japanese corporation Softbank to receive verbal but unequivocal guarantees. He was spurred to revelations about plans for privatization by a desire to stop the leakage of information about the impending deal through other channels. Moreover, the day before, the Financial Times published an article about the intentions of Arab investors to acquire a large stake in Tesla. During a speech in court, Elon Musk also admitted that he was ready, if necessary, to sell shares of SpaceX to finance a deal with Tesla.
In the end, the jury was convinced of Musk’s innocence, although other evidence indicated his lack of timely consultations with banks that could provide the billionaire with funds to buy Tesla shares. A week after the controversial tweet was published, Goldman Sachs and Silver Lake Management, for example, were still trying to figure out a financing structure for the deal.
If you notice an error, select it with the mouse and press CTRL + ENTER.
