Elon Musk to face trial in securities fraud lawsuit over 2018 tweets suggesting possible private takeover of Tesla Inc. The case is unusual because securities fraud cases are usually resolved before trial, such as by settlement.

Glen Littleton

The investor, Glen Littleton, sued Tesla, Musk and then-Tesla board members, claiming that Musk's tweets were fraudulent and cost investors billions by spurring Tesla stock, options and bond prices to fluctuate. He is seeking compensation for these losses.

The defendants said the plaintiff would not be able to prove to the jury that the testimony was essentially false. Musk was considering privatizing Tesla, the defendants said, even if some of his claims about the deal may not have been literally accurate.

Musk and Tesla

Musk said he is indeed considering privatizing Tesla and believes he has the backing of Saudi Arabia's sovereign wealth fund. Lawsuit over Elon Musk's 2018 tweets. Musk and Tesla agreed in 2018 to pay $20 million to settle civil charges brought by the Securities and Exchange Commission over the same tweets.

Judge rejects Elon Musk's request to move trial over Tesla's tweets

During jury selection on Tuesday, attorneys and Judge Chen focused on potential jurors' personal views on Musk and his acquisition of Twitter Inc., as well as on the extent to which they could put those views aside. Musk and Tesla's attorneys asked Judge Chen to move the case to Texas on the grounds that the Bay Area jurors were exposed to excessive negative publicity about Musk. Judge Chen denied that request late last week.

U.S. District Judge Edward Chen held a hearing on the case Friday morning and said the trial will begin next week in San Francisco. Prior to the trial, the court sent questionnaires to about 190 prospective jurors asking for their views on Musk and other issues to help determine if they had prejudices that would prevent them from sitting on a jury.

Judge Chen said he reviewed the responses and that about 49 of them reflected Musk's and Tesla's mixed views, about 27 seemed sympathetic to the defendants, and about 76 showed negative attitudes. Other responses seemed neutral. The jury trial in San Francisco is scheduled to continue until February 1.

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Musk in court

Musk will take the stand on Wednesday, about two months after he did so in Delaware over his Tesla pay package. Musk last spoke two months ago in a Delaware lawsuit over his Tesla pay package. In 2021, he appeared in a Delaware Commercial Court to defend Tesla's acquisition of SolarCity Corp. for about $2.1 billion in 2016. The judge sided with Musk, finding that Tesla did not overpay because the Tesla group was accused by shareholders. This decision has been appealed.

Also on the list of potential witnesses are Tesla's CEO Robyn Denholm, board members Ira Ehrenpreis, James Murdoch and Kimbal Musk, the CEO's brother. You can also call the head of investor relations, Martin Viech.

Tesla share prices

Meanwhile, Tesla has slashed prices across its entire range of vehicles, with some of last week's US cuts approaching 20% in an effort to boost demand. Tesla's share price started to rise again in the new year, but from Tuesday it started to fall again. During those days, the stock fell from 131.49 to 126.71.

Source: wsj.com, finance.yahoo.com