Key takeaways:
- The jury found that Elon Musk did not act with “actual malice” or with the intent to harm investors.
- The two words, “funding secured,” resulted in the CEO having to forfeit his position as Tesla’s executive chairman and pay millions of dollars in fines and legal fees.
- The case was closely watched by investors, as it could have had a major impact on the future of Tesla and Musk’s role as CEO.
A California jury has ruled in favor of Elon Musk, finding the Tesla CEO not liable for losses experienced by shareholders following his 2018 tweet about taking the electric car maker private.
The unanimous verdict, announced Friday in US District Court, ends a three-week long trial over a class-action shareholder lawsuit regarding the tweet, in which the billionaire said that he was thinking about taking Tesla private for $420 a share and had “funding secured.” The plaintiffs — several Tesla shareholders — argued that the tweet cost them millions of dollars in losses.
During the trial, Musk personally took the witness stand to defend the tweets, testifying he believed he had a handshake agreement in 2018 with Saudi Arabia’s Public Investment Fund to convert Tesla, which is a publicly traded company, into a private one.
The jury found that Musk did not act with “actual malice” or with the intent to harm investors. The two words, “funding secured,” resulted in the CEO having to forfeit his position as Tesla’s executive chairman and pay millions of dollars in fines and legal fees.
The Friday verdict represents a legal victory for the 51-year-old billionaire, who has seen the value of his Tesla holdings decline some 44% over the past year. Musk had spoken to executives of the Saudi sovereign wealth fund about the funding he would need to take Tesla private.
The jury’s decision is a relief for Musk, who has been under intense scrutiny since the tweet was sent. The case was closely watched by investors, as it could have had a major impact on the future of Tesla and Musk’s role as CEO.
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