On January 18, local time, Tesla CEO Elon Musk was tried in the federal court of San Francisco by Tesla's shareholder class action. A nine-person jury will hear from both the prosecution and defense, and the outcome of the trial will depend on the interpretation of Musk's motives for tweeting in 2018.
Musk reportedly tweeted in 2018 that he was considering taking Tesla private at $420 per share, adding that "funding is in place." However, the plan came to an abrupt end a week later because of insufficient funds to complete the deal.
In the trial on the 18th, the shareholders believed that Musk's remarks were false and misleading investors. After this tweet, Tesla's stock price fluctuated violently, causing them to suffer significant financial losses. Musk explained that he had reached an agreement with the Saudi Public Investment Fund to take Tesla private at $420 per share.
Musk's tweet also sparked a civil lawsuit from the U.S. Securities and Exchange Commission last year, after disclosure revealed that Saudi investors did not fully agree to fund the deal. The two parties eventually settled the lawsuit, and Musk and Tesla paid a total of $40 million in fines and were forced to resign as Tesla's chairman.
According to the Associated Press, the jury will hear the statements of the prosecution and defense, and finally determine whether the tweet affects the interests of shareholders and Tesla's stock price, and how it affects the stock price, based on Musk's motives for publishing the tweet. The trial is expected to last three weeks.
Source: CCTV News, CCTV Finance
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