Did the Tesla boss’s tweets, saying in 2018 that he was going to take the company out of the stock market, violate stock market laws? The answer is “no”, according to the jurors, after three weeks of trial. They thus declared this Friday Elon Musk found not guilty of fraud.
The billionaire had surprised investors on August 7, 2018 by saying on Twitter that he wanted to withdraw his automotive group from the stock market at a price of 420 dollars per share, or 23% more than the closing price the day before, then by assuring that the funding was “secured”. The stock surged, ending up 11% on the day, before declining in the following days. Investors then betting on a drop in the action, “short-sellers”, believe that Elon Musk broke stock market laws by presenting false information that caused the action to rise, and are asking for compensation.
If Elon Musk “believes something, or even thinks about it, then it’s true, it doesn’t matter if it’s objectively false or exaggerated”, argued the lawyer for the plaintiffs, investors who believe they have been wronged, in his argument. final. The judge in charge of the case, Edward Chen, has already concluded that the tweets were indeed misleading and that the entrepreneur had acted “irresponsibly”.
At the helm at the start of the trial, the entrepreneur assured that he had “never” sought to deceive investors. He really thought he had access to enough financing, even if it meant selling shares of his other company SpaceX, for example, he said, while acknowledging that he had no firm commitments from partners.
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His lawyer, Alex Spiro, also admitted that writing “secured financing” was “technically inaccurate”. But funding “was never the problem”, he repeated several times. “Just because it’s a bad tweet doesn’t make it a fraud,” he claimed. And these two words are so vague that “no one really knew what it meant”, argued Alex Spiro.