Fraud lawsuit launched against Elon Musk

Fraud lawsuit launched against Elon Musk

Elon Musk. Bobby Yip/REUTERS

The billionaire is on trial for a tweet published in 2018, where he wrote that he wanted to take his company Tesla out of the stock market. His messages had caused the stock to swing sharply for a few days.

A trial against Elon Musk opened on Tuesday January 17 in San Francisco with the selection of the members of the jury, which will have to decide whether the boss of Tesla and Twitter wrote a fraudulent tweet in 2018, as accused by investors.

The case dates back to August 2018, when Elon Musk tweeted that he wanted to take Tesla out of the stock market, then that he had the necessary funding to do so. His messages had caused the stock to swing sharply for a few days. “Plaintiffs claim these tweets were factually false and artificially affected Tesla’s stock price and other securitiessummed up Judge Edward Chen for potential jurors.

On Friday, the magistrate refused to transfer the proceedings to Texas, the American state where Elon Musk moved Tesla’s headquarters. The defense argued that the multi-billionaire could not benefit from an impartial trial in San Francisco, where he bought Twitter in late October, and was widely criticized for his decisions, from the platform’s content moderation policy to mass layoffs.

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“Biased and negative articles”

In recent months, local media have saturated this district with biased and negative stories about Mr. Musk“, had said the lawyers in a request. “The local press, contrary to its usual way of covering (the redundancy plans), personally blamed Mr. Musk for the job cuts and even accused him of breaking the law. Local elected officials, including the mayor of San Francisco, participated in protests against himthey continued.

Edward Chen, on the contrary, estimated on Friday that an impartial jury could be constituted in the Californian city. The trial is scheduled to last three weeks, and Elon Musk is on the witness list. In a previous decision related to this case, the judge ruled that the infamous 2018 tweet could be considered “false and misleading“. The short messages from the boss of Tesla have already earned him numerous disputes with the authorities.

The American stock market policeman, the SEC, had also filed a complaint at the time, believing that Elon Musk had not provided proof of his financing. The regulator then forced him to hand over the chairmanship of Tesla’s board of directors, pay a $20 million fine and later demanded that his tweets directly related to Tesla’s activity be pre-approved by a lawyer. competent. Elon Musk tried again in the spring to invalidate this decision, in vain.

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