The lawsuit pitting Tesla CEO Elon Musk against the company’s shareholders has begun. The case dates back to 2018, when the billionaire published a tweet in which he claimed to want to privatize Tesla.
The lawsuit began in California on Tuesday after Tesla shareholders sued Elon Musk over his 2018 tweet claiming he was ‘considering taking Tesla private’ and had ‘funding secured’, which has spiked the company’s stock price skyrocketed before plummeting when its claims actually didn’t work, and investors lost money.
Twitter shareholders also sued Elon Musk in California in May 2022 after the social network’s takeover was completed. Shareholders accuse the billionaire of intentionally trying to “significantly drag Twitter’s stock down” through tweets and public statements in order to back out of the deal or renegotiate it.
Another lawsuit filed in California in October 2022 on the same grounds targets “false and misleading statements” the Tesla CEO allegedly made about whether or not he was going to close the deal with Twitter before the CEO. is finally concluded in October.
The class action lawsuit was filed on behalf of shareholders who lost money selling their shares when Elon Musk caused Twitter’s share price to plummet by questioning the deal through his public statements allegedly false, before finally closing the deal and driving the stock price up.
In April 2022, a Twitter shareholder sued Elon Musk in New York, also on behalf of Twitter investors who had sold their shares, alleging that the billionaire had failed to disclose his Twitter stake within the time prescribed by the Securities and Exchange Commission (DRY). By not meeting these deadlines, Elon Musk could have bought more Twitter shares at a lower price before the disclosure of his stake and the price rally.
Luigi Crispoa Twitter shareholder, sued Elon Musk in July 2022 for breach of contract to force him into the deal to buy Twitter, and although most of the lawsuit was dismissed in October, some of the claims by Luigi Crispo are still ongoing.
The four lawsuits filed by Twitter shareholders against Elon Musk are still pending, and judges have yet to decide whether to dismiss the cases or proceed with the lawsuits. In the Tesla lawsuit, Elon Musk risks losing billions of dollars. The billionaire has denied the charges against him in the Twitter and Tesla lawsuits.
According to the latest estimates of ForbesElon Musk’s net worth stands at $150.1 billionwhich makes him the second richest person in the world after Bernard Arnault, the CEO of LVMH. Elon Musk’s fortunes have already taken a hit in recent months following the takeover of Twitter, as the billionaire lost his status as the richest person in the world and saw his net worth dip below $200 billion. dollars in November 2022. These losses are linked to the fall in Tesla’s share price in the Twitter operation, which raised concerns about Elon Musk’s involvement in the electric vehicle company. .
Elon Musk was previously tried in November 2022 in a separate lawsuit brought by Tesla shareholders, which targeted the salary package Tesla’s board awarded him in 2018. The lawsuit, which sought to determining whether the salary package was unfairly high ended in mid-November, but the Delaware judge presiding over the case has yet to announce the verdict.
Tesla shareholders first sued Elon Musk in 2018, days after the billionaire sued tweeted on his alleged plan to privatize the company. The tweet has already prompted an SEC complaint against Elon Musk, who had to step down as company chairman and whose tweets about the company must be cleared by Tesla lawyers before they can be shared. The judge overseeing the trial of Tesla shareholders has already ruled that the billionaire “acted recklessly” with his tweet.
Elon Musk completed the takeover of Twitter in October, after months of turmoil following the disclosure of his majority stake in the company in April.
Article translated from Forbes US – Author: Alison Durkee
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