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- According to the WSJ, a jury found that investors failed to prove Elon Musk's derailment of them by his tweet that he had "funding secured", to take Tesla private.
- Musk was vindicated by the outcome. He had claimed that his tweet did not influence Tesla's stock prices.
- Tesla investors claimed that his public statements caused billions in damages.
Late Friday, Elon Musk was found guilty by a federal jury. The jury concluded that Tesla investors failed in their proof that Musk derail them with a 2018 tweet claiming he had "funding secured", to take Tesla private. This deal never happened.
According to a Wall Street Journal report, the nine-member jury reached a conclusion within minutes of deliberations having begun.
This verdict was the result of a civil trial at San Francisco Federal Court. Jurors heard testimony by high-profile witnesses, including Musk, his former chief financial officer Deepak Ahuja and Musk's former chief staff member Sam Teller.
Musk's defense emphasized his July 2018 meeting with Yasir Al-Rumayyan (a Saudi Arabian official in the Private Investment Fund), in which he stated that Al-Rumayyan had pledged to help finance the deal. He told jurors last month that those verbal assurances led him to tweet that he had "funding secured for a take private deal for Tesla."
Nicholas Porritt, Levi & Korsinsky LLP, an attorney representing Tesla shareholders, challenged this narrative. In closing arguments on Friday, Porritt stated that any discussion about financing, which he estimates could reach $60 billion, should have been at least written down. Musk, however, did not take notes.
Porritt claimed in court that sometimes we can substitute what we wish happened for what actually happened. When you are facing lawsuits and government investigations for billions of dollar, this can happen.
Musk posted a tweet in August 2018 that read: "Am considering taking Tesla Private at $420." Funding secured
Alex Spiro, Quinn Emanuel Urquhart & Sullivan's Musk's lawyer, argued in closing arguments that Musk had been portrayed by his adversaries as a fire-breathing dragon and that Musk could not be blamed for being a bad Tweeter.
The US District Judge Edward Chen had previously ruled that Musk's tweets were false and that jurors would have to decide whether they were material. This meant that jurors would have to decide if Musk's statements had sufficient significance to affect investors' trading decisions.
Musk's comments about the possible deal also attracted the attention of securities regulators. In September 2018, they took $40 million from Musk and the company and declared that he couldn't continue to lead Tesla's board.
Porritt, the attorney for Tesla investors, had presented the stakes in the case in broad, existential terms. He argued that it was down to whether regular investors could trust public markets.
He stated that rules should be fair and applied to all, regardless of whether it was the securities markets or football games. "The issue in this case is whether Elon Musk should be subject to the same rules as everyone else."
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By: insider@insider.com (Sindhu Sundar,Grace Kay)
Title: Elon Musk was reportedly cleared by a federal jury’s verdict that his ‘funding secured’ tweet in 2018 didn’t harm Tesla investors
Sourced From: www.businessinsider.com/elon-musk-wins-trial-over-funding-secured-tesla-tweet-report-2023-2
Published Date: Fri, 03 Feb 2023 23:35:33 +0000
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