«market manipulation»
Elon Musk in court over Tesla tweets
Tesla CEO Elon Musk is due to appear in a California court on Tuesday for manipulating the stock markets through a 2018 tweet.
Tesla CEO Elon Musk is due to appear in a California court on Tuesday for manipulating the stock markets through a 2018 tweet. (archive image)
A court spokesman said on Friday that federal judge Edward Chen rejected Musk’s request to move the trial from San Francisco to the state of Texas, where Musk has since moved Tesla’s headquarters. Jury selection is scheduled to begin on Tuesday.
At the beginning of August 2018, Musk caused a stir with a message on Twitter that he was considering withdrawing the electric car manufacturer from the stock market and that the financing for this was “secured”. The unconventional announcement caused unrest on the stock markets; Tesla shares rose by almost eleven percent, after which the New York Stock Exchange temporarily suspended trading in the paper.
A few weeks later, Musk backed out: he announced that staying on the stock exchange was the “better way for Tesla”. A lawsuit has been filed against Musk for “artificially manipulating” the price of Tesla stock in order to harm any investors who had bet on the share price going down.
Musk’s lawyers had justified the call for the trial to be relocated to Texas because public opinion in San Francisco was directed against him because of his purchase of Twitter and the subsequent wave of layoffs from the online service. Local media have published “biased and negative posts” about Musk in recent months, and local politicians like San Francisco’s mayor have taken a stand against the entrepreneur.
According to the Bloomberg news agency, Judge Chen countered these arguments by saying that Musk also had “many fans” in San Francisco. The compilation of an impartial jury is quite possible. In a previous decision, the federal judge had said that Musk’s tweet could be considered “false and misleading”.
Musk has already had a lot of trouble with the US authorities because of the tweet. The Securities and Exchange Commission forced him to vacate his position as chairman of Tesla’s board of directors in 2018, requiring Musk’s tweets directly related to Tesla to be reviewed by a lawyer before they could be published. In addition, Musk and the electric car company each had to pay a $20 million fine. Last spring, Musk tried unsuccessfully to overturn the SEC decision.
(SDA)