Elon Musk Defends ‘Secured Funding’ Tweets in Tesla Shareholder Trial

Elon Musk Defends ‘Secured Funding’ Tweets in Tesla Shareholder Trial

Elon Musk said that just because he tweeted something “doesn’t mean people believe it or act on it.” The Tesla boss took the witness stand in federal court in San Francisco to defend himself (and the tweets he made in 2018) in a lawsuit brought by a group of the automaker’s shareholders. “I think you can be absolutely honest, but can you be complete? Of course not,” he added, regarding Twitter’s character limits. If you recall, Musk tweeted in August 2018 that he was “considering taking Tesla private for $420” and that he could already get funding. “Investor support confirmed,” he said in a follow-up tweet.

The CEO later revealed that he was in talks with the Saudi Arabian Public Investment Fund, which has reportedly expressed interest in Tesla as part of the country’s bid to reduce its reliance on oil. However, the deal did not materialize and he later wrote a lengthy post on the automaker’s website to say it will remain public.

What CNBC notes, shareholders blamed those “funds secured” tweets for their significant financial losses, prompting them to file a class action lawsuit against Musk. Tesla shares apparently remained highly volatile in the weeks that followed. The executive, however, downplayed the impact of his tweets, saying they don’t necessarily affect the share price: “There have been many cases where I thought if I tweeted something, the share price would go down. For example, in At one point I tweeted that I thought the stock price was too high in my opinion…and it went higher, which was, you know, counter-intuitive.”

In addition to the shareholder lawsuit, the Securities and Exchange Commission sued Musk over his tweets, calling them “false and misleading statements” that could constitute fraud. Musk and Tesla each paid $20 million to settle with the SEC, and the executive had to step down as chairman of the board. The SEC also required the company’s lawyers to approve any Tesla-related tweets Musk made, a condition the chief executive tried (and failed) to meet last year.

In addition to defending his tweets, Musk criticized short sellers during his testimony, telling the court that short selling “should be illegal.” He added: “In my opinion, it’s a means for bad people on Wall Street to steal money from investors. It’s not good.” Other information to glean from his time on the witness stand is that no one can tell Musk to stop tweeting. Asked by lawyers about advice he received to refrain from posting on Twitter after calling a British cave diver a “fart,” Musk said: “I kept tweeting, yeah.”

According to ReutersMusk only testified for less than 30 minutes and has not finished answering questions from lawyers. He is expected to take the witness stand again to explain why he wrote the funding tweets and why he insisted he was backed by Saudi Arabia.

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