Sketch of Elon Musk in front of a federal courthouse in San Francisco, during his January 20 appearance. Vicki Behringer (AP)
Elon Musk didn’t sleep well last night. It’s not clear if it was his second day as a witness in the Tesla shareholder lawsuit, the troubles on Twitter, or some other topic keeping him up at night, but he admitted before the jury, “Unfortunately, I’m not in my best moment.” . Though Musk is out of shape, he has denied allegations that he misled investors by saying he has “secure funding” to launch a delisting bid for automaker Tesla. As previously mentioned, the price of $420 (a marijuana nod) was “no joke.”
“It is very important that the jury knows that. Very important,” Musk said. According to agencies Bloomberg and Portal, who were present in the San Francisco courtroom where the trial is taking place, their two lines of defense were the ability to fund the operation with SpaceX stock and the allegedly determined will of Saudi sovereign wealth fund PIF to do so to participate. The businessman has focused almost his entire strategy on this second point.
The judge handling the case has already made it clear that the two words in the 2018 tweet (“secured funding”) were incorrect, but in order for Musk to be convicted of compensating investors, it must be shown that he had the will to do so This tweet changed the price and that shareholders investing in the heat of Musk’s alleged plans to launch an offering at $420 per share suffered losses.
Musk explained in his statement that he had dinner in 2017 with his friend Larry Ellison, founder of Oracle, which also included executives from Goldman Sachs and investment firm SoftBank, and that Ellison encouraged the idea of taking Tesla private, but Mostly Supported This Monday’s hearing focused on whether an agreement was reached with the Saudi fund to fund part of the expulsion bid.
When questioned by plaintiffs’ attorney Nicholas Porritt, Musk admitted that nothing was signed. However, the Tesla boss has repeatedly assured that there has already been an agreement for him. “They have more money than the value of all of Tesla,” he said, stressing that an investment of $5 or $10 billion wouldn’t be that relevant to the fund.
Musk’s problem is that while investigating the case, messages emerged from the head of the Saudi fund that there was no agreement and that he needed the details of the operation to move forward. However, Musk has said the fund’s executive has reassured him that he has already discussed the operation with the Saudi prince and that he therefore takes it for granted: “If they say they’re going to do something, they do it.” , has said. At the urging of the plaintiffs’ lawyer to clarify the content of the summer 2018 meetings with Saudi fund officials, Musk apologized, saying that five years had passed and he did not remember the details.
The Marijuana “Joke”
Musk was asked about the price of $420 per share, which is the number used to refer to marijuana, and he said it was a coincidence. The Securities and Exchange Commission (SEC) statement of objections, with which he agreed to pay a $20 million fine for the famous tweet, said Musk had considered a 20 percent bounty and has done so since 419 Dollars returned, he decided to round it up to $420 because “he had recently learned about the importance of the number in marijuana culture and thought that his girlfriend [de entonces]”he’d be amused, which isn’t a good reason to set a price,” he admitted.
Today he insisted it was a coincidence: “I don’t know if she thought it was funny or not. But the $420 price tag wasn’t a joke.” Musk offered $54.20 a share to buy Twitter, somewhat repeating the marijuana number in his offer.
In Friday’s session, Musk attempted to separate his tweets from Tesla’s stock market movements. He argued Twitter was “the most democratic way” to communicate with retail investors, with information he believes “the public should listen to.” In the controversial Aug. 7, 2018 tweet, Musk wrote, “I am considering delisting Tesla for $420. Secured Funding”. After his initial tweet, Musk, along with others, insisted that an upcoming surgery was proposed. “Shareholders can sell at 420 or keep the shares [en la compañía excluida de Bolsa]”, added.
Tesla’s shares soared (and fell when it emerged there hadn’t been a takeover bid to delist the company), but Musk tried to decouple that move from his tweet in court this Friday. “Tesla stock goes up and down all the time,” he once said. “Just because I tweet something doesn’t mean people believe it or act on it,” he argued.
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