On Tuesday, the highly-anticipated trial of US billionaire Elon Musk began in San Francisco. Jurors selected to decide if his 2018 tweet was fraudulent as alleged by investors were chosen quickly. As an influential head of both Tesla and Twitter, this case will be closely watched across the nation.
In August 2018, Elon Musk sent a tweet that he had the necessary funds to take Tesla private which caused the share price of his company to drastically increase. This incident sparked an investigation into potential insider trading for Musk and Tesla.
During jury selection, Judge Edward Chen declared that the prosecutors’ claims of false tweets and their purported effect on Tesla’s stock price were valid.
Am considering taking Tesla private at $420. Funding secured.— Elon Musk (@elonmusk) August 7, 2018
Last Friday, the court denied Tesla CEO Elon Musk’s request to move his trial proceedings to Texas, where he recently relocated his company headquarters. However, Musk’s legal team put forth a convincing argument that their client would not be able to have an unbiased trial if it was held in San Francisco.
In a prior judgment concerning this case, the judge determined that the renowned 2018 tweet could be classified as “deceptive and misguiding”. The tweets of Tesla’s leader have furthermore prompted debates between him and government officials in the past.
After Elon Musk posted a tweet, the Securities and Exchange Commission (SEC) filed an official complaint due to the lack of proof that he had secured adequate financing for his project.
At the time, the authority demanded that he give up his position as chairman of Tesla’s board and pay a fine of $ 20 million. They also mandated that every one of his tweets concerning Tesla must be approved by a lawyer before it was posted. The billionaire attempted to dispute this ruling, yet unfortunately failed in doing so.
In late October, Musk acquired Twitter and faced harsh criticism for his choices – from the site’s content management rule to a large number of lay-offs. It is important to remember this situation before making further decisions concerning him.