Elon Musk’s Twitter drama now moves to Tesla

As he faces the consequences of delisting a company, the embattled billionaire Elon Musk He now faces a trial by another company that he did not withdraw.

Long before he acquired Twitter for $44 billion in October, he set his sights on Tesla, the electric car maker of which he is still the CEO and where most of his wealth and fame comes from.

In a tweet on Aug. 7, 2018, Musk said he had raised the loans to pay for the $72 billion acquisition of Tesla, followed by a statement suggesting a deal was imminent.

But the transaction never materialized, and Musk must now explain his actions under oath in federal court in San Francisco. The trial, which begins in the next few hours with jury selection, is the product of a class action lawsuit on behalf of investors who owned Tesla shares for a period of 10 days in August 2018.

READ ALSO: After falling in 2022, business transactions will continue to decline this year

Musk’s tweets at the time sent Tesla’s stock price soaring, which ended abruptly a week later when it became apparent he did not have the funds to buy. The consequence of this was the abandonment of his plan to remove the automaker from the stock market and the payment of US$ 40 million to the financial market regulators, who forced him to resign as the company’s president.

Musk later alleged that he agreed to that arrangement under duress and that he believed he obtained financial backing for the Tesla purchase during meetings with representatives of the Saudi Arabian Public Investment Fund.

The outcome of the trial would depend on the jury’s interpretation of Musk’s motive for posting tweets that federal judge Edward Chen has already ruled to be lies.

READ ALSO: Central banks will continue to raise rates, says VP of BlackRock

Musk suffered a further setback on Friday when Chen rejected his request to move the trial to federal court in Texas, where Tesla has been based since 2021. Musk had argued that negative media coverage of the Twitter buyout tainted the list of potential jurors. from the San Francisco area.

As the new head of Twitter, Musk has laid off staff and angered users and advertisers. Existing Tesla shareholders fear he is spending less time running the automaker as competition intensifies. Those fears contributed to a 65% drop in Tesla shares last year that wiped out more than $700 billion of shareholder equity, far more than the $14 billion loss when prices fell between the 7th and August 17, 2018, the period covered by the class action lawsuit.

Source: AP.