The “funding secured” tweet from Tesla’s CEO Elon Musk was at the core of a class-action securities fraud trial, in which Musk was held not guilty.
The case centred on whether Musk could be held responsible for shareholder losses after his August 2018 tweets claiming he had secured the funds to take Tesla private. Prior to the $420 price tag, Musk tweeted, “Am contemplating taking Tesla private.” Securing the necessary funds. Two more tweets came shortly after, each reading, “Investor support is verified.” However, another stakeholder has said that he does not currently have a controlling vote and that he “wouldn’t expect any shareholder to have one if we go private,” therefore the deal is not yet finalised.
Shareholders’ lawyers contended monetary harm had been done to their clients as a consequence, the plaintiffs. To put it another way, Musk was looking at billions of dollars in losses.
The trial, which began three weeks ago in San Francisco, ended after the jury deliberated for a little over two hours and read its judgement.
After the verdict was announced, Tesla’s stock rose $1.50, to $189.98.
The tone and meaning of the tweet were crucial to the outcome of the trial. Plaintiffs claimed it caused them financial harm, but Musk’s legal team maintained that although the tweet was truthful (Musk did want to take Tesla private), the statement “funding secured” was the improper word to use.
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