• Investors argue that the tweets tantamount to lies, due to which they suffered heavy losses due to wild swings in share prices in the 10-day period before the scheme was abandoned
Tesla Inc CEO Elon Musk defends himself in a trial over his 2018 tweets about taking the electric carmaker private over how much effect his tweets had on the company's share price.
"It's hard to say that the stock price is linked to the tweet," he told jurors in San Francisco federal court on Friday.
Investors say the tweets tantamount to lies, which caused wild share price fluctuations over a 10-day period before they abandoned the plan. The trial requires jurors to delve into Musk's state of mind when he posted the messages, and to determine whether the billionaire's social media posts actually influenced investor trading.
Asked by an attorney for investors whether he needed to be precise with his tweets, Musk replied that he was providing "the information the public needs to hear," but only that a Twitter Can be expressed with a limit of 240 characters in the post.
Kasturi, dressed in a black suit and tie, appeared on the witness stand, removed his mask and smiled briefly at the jurors as if acknowledging them.
During questioning, Musk told the jury that 2018 was an "extremely painful and difficult year."
Musk said, "I was sleeping in the factory on my way to work."
He reiterated his mantra that short selling should be made illegal, telling jurors that short-sellers wanted the stock to go down and wanted Tesla to "die very badly."
Musk's lawyers told the jury during opening statements on Wednesday that while his tweets were rushed and contained technical errors, they accurately stated that he was sincere about taking Tesla private. Musk is expected to testify that the short-term plan to take Tesla private was solid, based on discussions with Saudi Arabia's sovereign wealth fund.
The lawsuit comes at a time when Musk's wealth has declined from a peak of $340 billion in November 2021. The world's richest man and Tesla's stock are down 33% since December 1, as the electric-car maker faces increasing competition and a recession.
Musk is no stranger to court battles—and has been nicknamed "Teflon Elon" for his ability to escape unscathed. He took the stand and won a trial in Los Angeles in 2019 and Delaware in 2021. He also testified in Delaware in November on the investor's case on his $55 billion Tesla pay package -- but that has yet to be decided.
The CEO tried to move his current lawsuit out of San Francisco, arguing that gamblers in the area would probably be biased against him because of recent layoffs and "local negativity" at Twitter. US District Judge Edward Chen denied the request, expressing confidence. An "impartial" jury will be seated, and the nine-person panel will be sworn in on Tuesday.
The jury has already heard from two Tesla investors who claim Musk's August 7, 2018 tweet led them to bet on the stock and take big losses.
Shareholder Tim Fries, a family man with three children in college, told Friday how the tweet prompted him to buy 50 shares the next day for $18,000.
Fries said, "Here we had Elon Musk telling the world he plans to take Tesla private with 'safe money'." "Given the share price at the time, it seemed like a good entry point."
Fries lost $5,000 when the stock dropped. “I joined this lawsuit because I felt that injustice had been done to me; I thought I lost money because of misrepresentation," Fries said. He added that to him the phrase "funding secured" meant that there was "some vetting, some critical review of sources"—which Musk's attorney Alex Spiro said. Tried to make it look like another talking point in his cross-examination.
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